Greencore Group plc – Annual Report and Financial Statements 2022

Greencore Group plc

Annual Report and Financial Statements 2022

Greencore Group plc – Annual Report and Financial Statements 2022

Our Better Future Plan

Read more on page 16

Our strategy

Growth Relevance

Differentiation

1Strategic Report | Directors’ Report | Financial Statements

Financial highlights

In this report

Strategic Report

About us IFC

Financial highlights 1

At a glance 2

Our strategic framework 4

Our business model 6

Chair’s statement 8

Chief Executive’s review 12

Market trends 14

Strategy 16

Sustainability 20

Climate Transition – Taskforce on Climate

Related Financial Disclosure (TCFD) 29

Our Key Performance Indicators 34

Operating and financial review 38

Risks and risk management 42

Group Executive Team 50

Directors’ Report

Chair’s introduction to corporate governance 52

Board of Directors 54

Board leadership and Company purpose 56

Board activities and engagement

with stakeholders 58

Division of responsibilities 68

Composition, succession and evaluation 70

Report of the Nomination and

Governance Committee 72

Report of the Audit and Risk Committee 76

Report on Directors’ Remuneration 83

Other statutory disclosures 109

Statement of Directors’ responsibilities 116

Financial Statements

Independent Auditor’s Report 117

Group Income Statement 125

Group Statement of

Comprehensive Income 126

Group Statement of Financial Position 127

Group Statement of Cash Flows 128

Group Statement of Changes in Equity 129

Notes to the Group Financial Statements 131

Company Statement of Financial Position 173

Company Statement of Changes in Equity 174

Notes to the Company

Financial Statements 175

Other Information

Alternative Performance Measures 179

Shareholder and other information IBC

Our FY22 Annual Report and Financial

Statements (‘this Report’) can be downloaded as

a pdf from this location: https://www.greencore.

com/investor-relations/results-centre/

Certain statements made in our FY22 Annual Report and Financial Statements are forward-looking. These represent expectations

for the Group’s business, and involve known and unknown risks and uncertainties, many of which are beyond the Group’s control.

The Group has based these forward-looking statements on current expectations and projections about future events based on

information currently available to the Group. These forward-looking statements include all statements that are not historical facts

and may generally, but not always, be identified by the use of words such as ‘will’, ‘aims’, ‘achieves’, ‘anticipates’, ‘continue’, ‘could’,

‘develop’, ‘should’, ‘expects’, ‘is expected to’, ‘may’, ‘maintain’, ‘grow’, ‘estimates’, ‘ensure’, ‘believes’, ‘intends’, ‘projects’, ‘sustain’,

‘targets’, or the negative thereof, or similar future or conditional expressions.

By their nature, forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances

that may or may not occur in the future and reflect the Group’s current expectations and assumptions as to such future events and

circumstances that may not prove accurate. A number of material factors could cause actual results and developments to differ

materially from those expressed or implied by forward-looking statements. There may be risks and uncertainties that the Group is

unable to predict at this time or that the Group currently does not expect to have a material adverse effect on its business. You should

not place undue reliance on any forward-looking statements. These forward-looking statements are made as of the date of this

Annual Report. The Group expressly disclaims any obligation to publicly update or review these forward-looking statements other

than as required by law.

1 The Group uses Alternative Performance Measures (‘APMs’) which are non-

International Financial Reporting Standards (‘IFRS’) measures to monitor the

performance of its operations and of the Group as a whole. These APMs along

with their definitions and reconciliations to IFRS measures are provided in the

APMs section on page 179.

Revenue

£1,739.6m

(Reported: +31.3%)

(Pro Forma: +29.4%)

Basic Earnings per Share (Basic ‘EPS’)

6.2p

(FY21: 5.0p)

Adjusted Earnings per Share (Adjusted ‘EPS’)

9.2p

(FY21: 3.7p)

Group Operating Profit

£52.1m

(FY21: £42.8m)

Adjusted Operating Profit

£72.2m

(FY21: £39.0m)

Free Cash Flow

£58.7m

(FY21: £72.2m)

Profit before taxation

£39.8m

(FY21: £27.8m)

Adjusted Profit Before Tax

£59.8m

(FY21: £22.6m)

Return on Invested Capital (‘ROIC’)

8.4%

(FY21: 4.5%)

2 Greencore Group plc Annual Report and Financial Statements 2022

STARBUCKS TRUE LOGOS. GENERATED BY CHI NGUYEN (CHISAGITTA)

Corporate

head office

At a glance

Supplying

the UK market with high

quality convenience foods

Who we are

Greencore Group plc is a leading manufacturer of convenience foods. We are proud to

supply a wide range of chilled, frozen and ambient foods to some of the most successful

retail and food service customers in the UK.

Locations

Corporate head office

Production sites

Distribution centres

Transport hubs

Irish ingredients

Barlborough corporate services

What we do and where we operate

Manufacturing

We operate 23 manufacturing units across

16locations, including eight sandwich units,

five chilled ready meal units, three salad

units, two sushi units, two chilled soup and

sauces units, one chilled quiche unit, one

ambient cooking sauce and pickles unit and

one Yorkshire Pudding unit. We also operate

an Irish ingredients business that imports

and distributes edible oils.

Distribution

We have built a strong Direct to Store

distribution operation comprising over

650 vehicles, five regional distribution

centres and 13 transport hubs.

manufacturing units

distribution centres

and transport hubs

650+

distribution vehicles

Our customers

We supply all of the major supermarkets

in the UK. We also supply convenience

and travel retail outlets, discounters, coffee

shops, foodservice and other retailers.

Some of our principal customers include:

3Strategic Report | Directors’ Report | Financial Statements

Our year in numbers –

items produced in FY22

249m

jars of cooking sauces,

dips and pickles

795m

sandwiches and other

food to go items

47m

chilled soups and sauces

127m

chilled ready meals

4 Greencore Group plc Annual Report and Financial Statements 2022

Our strategic framework

Connects

How it all

We are defined by…

Our purpose

Which guides on…

Our strategy

Our purpose, making every day taste

better, defines and inspires us.

Having a clear purpose and using it as a

guiding principle to the way we operate

supports the direction we choose to take,

inspires our strategy and how we deliver

against it.

It benefits our people, our customers,

our suppliers, our consumers, our local

communities, the wider environment

and ultimately our shareholders.

Read more on page 16

5Strategic Report | Directors’ Report | Financial Statements

How do we do that…

By following the

Greencore Way

Bringing to life sustainability through our…

Better Future Plan

The Greencore Way describes who

we are and how we will succeed.

It is built on four differentiators.

People at the Core

By embedding a safety

culture, providing

inspiring leadership and

having engaged and

effective teams, we

ensure that people are at

the core of our business.

Sustainability

Sustainability underpins

all areas of our business

from Sourcing with

Integrity to Making with

Care and Feeding

with Pride.

Great Food

Ensuring food safety,

leading on taste and

winning on quality are

all essential to our

continued success.

Excellence

We strive for excellence

in everything we do

by building capability,

driving efficiency and

delivering value for all

our stakeholders.

Our Better Future Plan is built around three pillars:

Each pillar contains a set of priorities — with

aspirational goals supported by milestone targets

which relate to the most pressing sustainability risks

and opportunities facing us as a business and the

food system within which we operate.

Sourcing with Integrity

By 2030, we will source our priority ingredients

from a sustainable and fair supply chain.

Mapping our plans to the UN Sustainable

Development Goals

Making with Care

By 2040, we will operate (Scope 1 & 2) with

Net Zero emissions.

Mapping our plans to the UN Sustainable

Development Goals

Feeding with Pride

By 2030, we will have increased our positive impact

on society through our products.

Mapping our plans to the UN Sustainable

Development Goals

Read more on page 42

better results through an

effective business model

7Strategic Report | Directors’ Report | Financial Statements

Making

with Care

Feeding

with Pride

Stakeholder

value creation

Shareholders

Creating sustainable value through

disciplined capital allocation.

See Operating and financial review on

page 38

Customers

Providing best-in-class customer

outcomes and satisfaction.

See Relevance on page 17

Suppliers

Enabling collaboration for all

parties to achieve goals and

drive growth.

See Sustainability on page 23

Consumers

Addressing key consumer demand

drivers through food innovation.

See Market trends on page 14

Colleagues

Investing in career development

and shaping career opportunities

that engage, reward and retain

our people.

See People at the Core on page 27

Community

Creating stronger and healthier

communities through education

and food-focused engagement.

See Sustainability on page 24

Our Great Food is

underpinned by our

dedication to food safety,

taste and quality.

We source and prepare our Great

Food to the highest food safety

standards every day. Our customers

and their consumers can trust what

we make. We work relentlessly to

ensure that we reach industry-leading

food quality standards in everything

we do. We also leverage our expertise

in food manufacturing and assembly

to provide ‘ready to eat’ products

using processes that are people-

intensive and environments that

are ‘high care’.

Number of different products

produced by Greencore in total

c.2,000

Internal and external audits across

all sites during the year

21,250

Number of daily deliveries by

our Direct to Store vehicles

10,600+

Sandwiches and other food

to go items produced in FY22

795m

We design products with taste,

freshness, health and affordability

in mind, and ensure that they

are packaged and distributed

as efficiently and responsibly

as possible.

We work closely with our customers

to innovate and improve recipes and

technologies that add value for them.

This is done across a range of product

categories including sandwiches, salads,

sushi, chilled snacking, chilled ready meals,

chilled soups and sauces, chilled quiche,

ambient sauces and pickles, and frozen

Yorkshire Puddings. We distribute

through our chilled distribution network

to customers’ distribution centres and to

selected food outlets through our dedicated

fleet of over 650 Direct to Store vehicles.

8 Greencore Group plc Annual Report and Financial Statements 2022

In September 2022 we announced the

appointment of Leslie Van de Walle as Chair

Designate, joining the Greencore Board

on 1 December 2022. We also announced

Gary Kennedy’s intention to retire from our

Board at the conclusion of our Annual

General Meeting (‘AGM’) in January 2023.

In this, Gary Kennedy’s final statement, we

ask him to reflect on the key developments

over the past 12 months.

Q: When you look back on

FY22, what do you think

were the key themes that

have had an impact on

Greencore?

A: The past year has been a period of

recovery, marked by a strong improvement

in both revenue and profitability for the

Group. Despite the well-documented,

industry-wide supply challenges and

disruptions, we have successfully worked

with both our customers and suppliers

to re-establish and maintain world-class

operational service levels. That is particularly

pleasing given the extent of supply chain

deficiencies, unprecedented inflation on

input costs and challenges in labour supply.

We have also successfully onboarded new

business wins, which have expanded the

Group’s product ranges and enabled us to

enter new channels. In FY22, new business

wins have accounted for approximately 4.4%

of the Group’s Pro Forma Revenue Growth.

We have recovered the vast majority of

our increased input costs and other inflation

impacts by working with our customer base.

There is still further work to do, but thanks

to the skill and work of our commercial

and procurement teams we are making

good progress.

Q&A

Gary Kennedy

with

“Our profitability improvement has

been a result of a strong focus

on efficiency gains and progress

on restoring our historical margin

levels. We must push on with

this progression, particularly with

the opportunity we have in our

business with record volumes.”

Chair’s statement

9Strategic Report | Directors’ Report | Financial Statements

Our profitability improvement has been a

result of a strong focus on efficiency gains

and progress in restoring our historical

margin levels. We must push on with

this progression, particularly given the

opportunity we have in our business with

record volumes.

We experienced an IT security incident in

December 2021 which resulted in temporary

unauthorised access to part of the Group’s

IT systems. Our immediate priority was to

respond quickly to the incident to protect the

Group’s infrastructure and to minimise the

impact on operations. I am incredibly proud

of the dedication shown by our teams in

responding to this event.

We have invested in supporting our

people through the ongoing cost-of-living

pressures, both through salary increases

and through a wide range of other support

measures, including free tea and coffee

for all colleagues, access to a shopping

discount platform, vouchers, and offering

our colleagues the opportunity to purchase

our own products at nominal prices.

Q: What progress

have you made on your

strategic agenda over

the past 12months?

A: Our strategic agenda was significantly

interrupted by COVID-19 and more recently

our focus has been on recovery of our

economic and operating model.

Notwithstanding this, last year, we

announced business wins which required a

programme of strategic capital investment

and I am delighted to confirm that this has

now been completed. While there have

been certain commissioning challenges,

our focus is now on driving operating

efficiency and improved output and

conversion rates. Iwould like to thank our

project and operational teams for delivering

these investments. This is another great

example of the partnership model that we

have developed with customers over many

years, and that has been especially important

through the challenges of COVID-19 and the

inflationary environment.

FY22 also saw the launch of our business

change programme, Better Greencore.

The first phase is targeted to deliver

annual recurring benefits of £30m in FY24.

A key element of the first phase of Better

Greencore was the review and redesign of

our organisation, creating a more customer-

focused structure. We will launch the

second phase, focusing on operational

and technological excellence in FY23.

Our sustainability agenda has developed

significantly over the last 12 months, and

we’re now well on our way to embedding

sustainability as part of our everyday

business. We have made good progress

on our foundations; data, embedding and

risk analysis, but this is not yet resulting in

absolute reductions in our carbon footprint.

We are looking at ways to accelerate delivery.

Q: What are your thoughts

on the Group’s financial

performance inFY22?

A: Our Group financial Key Performance

Indicators (‘KPIs’) are underpinned by a

set of profitability, return and cashflow

measures and they form the basis of our

remuneration criteria.

Our post-pandemic recovery is reflected

in strong sales growth, with Group Revenue

up by 31.3% to £1,739.6m as we continue

to address the inflationary and supply issues

that exist in the market.

In this context we were happy to deliver

Adjusted Operating Profit of £72.2m and

Adjusted EPS of 9.2p.

The balance sheet of the Group has been

significantly strengthened during FY22 with

substantial liquidity headroom and continued

progress on deleveraging.

Adjusted Operating Margin

4.2%

Pro Forma Revenue Growth

29.4%

“The past year has been a

period of recovery, marked

by a strong improvement

in both revenue and

profitability for the Group.”

10 Greencore Group plc Annual Report and Financial Statements 2022

Chair’s statement continued

I am pleased with our continued strong

recovery in what have been challenging

conditions. Our transformation work will

enable us to continue to drive forward our

profit conversion from the strong sales that

we are continuing to grow.

Q: How has the Board

approached capital

management as FY22

evolved?

A: After a period in FY20/FY21 where

capital protection was the primary focus,

it was pleasing that we were able to reduce

leverage in FY22 towards our medium

term targets of 1.0 to 1.5 times Net Debt to

EBITDA. While continuing to invest in our

business model we also recommenced

value return to our shareholders in the

form of a share buyback programme.

Our intention to return approximately £50m

to shareholders in the two year period to

FY24 remains in place. We completed the

first tranche, £10m, on 6 October 2022,

having returned £8.8m as at 30 September

2022, and we have announced the second

tranche of our buyback programme with

our FY22 Results release. Our dividend

payments have been suspended since FY20

and we recognise that for some shareholders

this would be their preferred option of

shareholder return. The Board does intend

to reinstate dividend payments at some

point in the future, and this will be

communicated in due course.

Q: What were the main

Board changes inFY22?

A: On 25 November 2021, Patrick Coveney

informed the Board that he would be

stepping down from his role as Executive

Director and Chief Executive Officer (‘CEO’)

on 30 March 2022. At that point we initiated

a search for his successor, resulting in the

appointment of Dalton Philips as Executive

Director and CEO as of 26 September 2022.

We are delighted to have made this

appointment.

As you know I stepped in as Executive Chair

upon Patrick’s departure; and Kevin Moore

was appointed as Deputy CEO. I want to

personally thank both Kevin and Chief

Financial Officer, Emma Hynes for the

support they provided both to me personally

and to the Group while we filled the

CEO position. Their contribution was

superb, providing the business with

strong governance, strategic direction

and leadership.

In May 2022, Gordon Hardie stepped down

as Non-Executive Director. In September

2022, we announced that Helen Weir had

elected to step down from the Greencore

Board with effect from 31 December 2022.

Helen’s focus on Board and Audit and Risk

Committee matters has been invaluable to

both the Board and the wider Group. In

October 2022, we announced that Paul

Drechsler had decided not to seek re-election

to the Greencore Board at the Annual General

Meeting (‘AGM’) in January 2023.

I would like to reiterate my sincere thanks

to Patrick, Gordon, Helen and Paul for their

valuable contributions.

We also announced in September 2022

the appointment of Leslie Van de Walle as a

Non-Executive Director and Chair Designate.

Leslie will join us on 1 December 2022 and

will take over my role as Non-Executive

Chair when I retire from the Board at our

AGM in January 2023. Leslie brings many

years of food industry experience and

knowledge and has a wealth of Non-

Executive and Chair experience across

multiple sectors. I know that he will be

a great support to Dalton and the rest

of our Group Executive Team.

I would also like to offer my thanks and that

of the rest of the Board to Jolene Gacquin,

who stepped down as Group Company

Secretary in September 2022. She provided

invaluable support to the Board and I’m sure

many of you will join me in wishing her well

for the future. Damien Moynagh joined us

as General Counsel and Company Secretary

in November 2022 and we are delighted

to welcome him to Greencore.

Following a Board Committee compositional

review during the year, I retired from, and

Anne O’Leary joined the Remuneration

Committee on 21 June 2022. Further detail

is set out in the Nomination and Governance

Committee Report on page 72.

Q: A major announcement in

FY22 was the appointment

of Dalton Philips as Group

CEO. What was it that

impressed you about Dalton?

A: There are many things about Dalton that

impress me. He has a strong track record

of leading dynamic consumer-related

businesses, and he has an outstanding

knowledge of the grocery sector.

He is an excellent leader, very effective

communicator and has a great awareness

of all stakeholder interests.

As we continue to emerge strongly from the

challenges of trading through the pandemic,

both I and the rest of the Board see him as

the ideal person to lead Greencore into the

next phase of our journey. We are thrilled

that a person of his calibre and experience

has joined our Group Leadership team

and Board in this vital role.

Q: How do you view the

outlook for Greencore?

A: Revenue performance in the early weeks

of FY23 has broadly held up well, however,

we do note some mix effect between

categories. We remain cautious about

the potential impact of the recessionary

environment and cost-of-living factors on

consumer spending through the year ahead.

We expect that FY23 will be a year of further

substantial inflation and we are working with

our customers on recovery and mitigation.

We remain focused on the execution of our

Better Greencore change programme and

continue to plan for the second phase which

focuses on operational and technological

excellence. We continue to make decisions

on customer contracts which are no longer

economic, with a heightened focus on our

ability to recover inflation.

We are confident that continued focus on

the strengths of the business, underpinned

by our resilient balance sheet and the

efficiency and productivity gains related

to our Better Greencore programme will

support the further successful progress

of the Group in the years ahead.

11Strategic Report | Directors’ Report | Financial Statements

Q: Finally, what are your

reflections on your time

as Chair of Greencore?

A: It has been a privilege to work with so

many talented colleagues at Greencore for

more than 14 years, as we transformed the

Group into a leader in the UK convenience

food sector and I am particularly proud of

the work we have done in creating a diverse

Board, with 60% female representation –

exceeding the recommendations in the

Hampton-Alexander Review.

In my time as Chair, there have been many

changes, both internally at Greencore and

more widely in society in general. But

nothing comes close to the impact the

COVID-19 pandemic has had on us all.

Aside from the business impact and the

incredible way that the Greencore team

managed through the pandemic as

key workers, Iwould like to, once again,

acknowledge and offer my deepest

sympathies to the families and friends of

our colleagues who sadly passed away

from COVID-19 – and to those that are

living with the effects of the virus, I wish

them a full and speedy recovery.

I have every confidence that the Group,

under Dalton’s leadership, has the

capabilities to continue to lead and grow

in its markets in the years ahead and I know

that our new Chair, Leslie Van de Walle,

will provide the Board with strong and

effective direction.

Finally, I would like to say a huge thanks

to all our colleagues, our customers, our

suppliers and our investors for their ongoing

commitment and support to both myself

specifically and to Greencore.

Gary Kennedy

Board Chair

28 November 2022

12 Greencore Group plc Annual Report and Financial Statements 2022

Q: What attracted you to the

role of Greencore CEO?

A: With a background growing up in the

food industry in Ireland, I’ve been aware of

Greencore as an iconic Irish food business

since its foundation. On top of that, I was of

course a customer of Greencore from my

time at Morrisons. My impression when I was

on ‘the other side’ was of a dynamic and

ambitious business that was fanatical about

servicing its customers’ needs. So, when the

opportunity came my way it was an easy

decision to make, and so much of what I’ve

seen so far has cemented the positive view

that I already had of the business. I’m

delighted and proud to be here and, despite

the challenges that the industry is currently

experiencing, I see big potential for future

value creation.

Q: Tell us more about this

value creation potential that

you see for the business?

A: Fundamentally, we operate in attractive

and growing markets. There will always be

demand for high quality convenience food,

and you can see from the investment that

our customers are making in this area that it’s

a real priority for them. They are constantly

asking us to do more for them, and we have

a fantastic opportunity to do so – given

our scale, our long-standing customer

relationships, and our reputation for service,

quality and innovation. At the same time,

we are a business that is still in recovery after

a really difficult couple of years through the

pandemic. As we continue to reset – our

operating model, our portfolio and our cost

base – there is so much potential for us to

be an even better business. Make no mistake,

there will be challenges along the way –

and the headwinds for our sector are well

documented – but we are very well placed

in the medium to long term.

Dalton Philips joined Greencore

as our Chief Executive Officer on

26September 2022, after five years

as CEO of daa plc, the global airports

and travel retail group. Prior to

that, Dalton served as CEO of

Wm Morrison plc, one of the UK’s

largest supermarket chains.

In this Q&A, we ask Dalton to

share what it was that attracted

him to Greencore, what his initial

observations have been and how

he sees the future of Greencore.

Chief Executive’s review

with CEO

Dalton Philips

13Strategic Report | Directors’ Report | Financial Statements

Q: You joined Greencore at

the end of September. What

are your initial observations,

and do they live up to

your expectations?

A: The first thing that hits you on spending

any length of time at Greencore is the

exceptional quality of the people. Of course,

I already knew about the fantastic work that

Gary Kennedy, Emma Hynes and Kevin

Moore were doing in leading the business

since Patrick Coveney stepped down in

March, but what I was less aware of was the

strength and depth of the teams at absolutely

every level of the Company.

In my first month or so with the business I‘ve

spent a lot of time visiting our manufacturing

sites and distribution depots – getting to

meet our people and really getting under

the skin of what they do and how they do it.

This has been invaluable for me in helping

me to get know the business, and I can

honestly say that everyone I’ve met has

impressed me with their passion, enthusiasm,

knowledge and professionalism.

It’s also been fantastic to see ‘behind the

scenes’ of the sheer breadth of our capability

– whether that be our manufacturing

network of real scale and diversity, our

distribution network that delivers daily to

every corner of the UK, our award-winning

food credentials or our leading position

with customers.

Of course, there are definitely areas that can

be improved on – and I wouldn’t have joined

if that wasn’t the case – but all in all my initial

observations have been very favourable.

Q: What are our customers

saying about Greencore?

A: The feedback I’ve picked up so far – both

informal and formal - has been consistently

positive. I think the most eloquent testament

to our customers’ opinion is the fact that

Greencore ranked number one in the most

recent annual Advantage Group survey,

where retailers rank their chilled foods

suppliers across a range of important areas.

There’s definitely even more that we can

be doing for our customers in both existing

and new areas, and it’s clear that there is

a high level of demand for our products.

That’s a great place to be for any supplier

in any industry.

Again, let’s be clear: these are challenging

times for the food industry, and there are

difficult conversations taking place between

suppliers and retailers given the inflationary

pressures that we’re seeing. But at the heart

of these conversations is a determination to

do what’s right for consumers, whilst at the

same time ensuring that we can continue to

mutually support each other’s growth plans.

Q: What changes, if any,

have you made to the

business so far?

A: In my first weeks, my overriding focus

has been on seeing, listening and learning

rather than on implementing any immediate

changes. However, we have made some

important appointments with new team

members coming on board. Lee Finney

joined us as Chief Operating Officer in

October, with an outstanding track record

of implementing operational excellence in

the global food and beverage industry, and

I am delighted to have him on the team.

His leadership will be critical as we build on

the work that has been done as part of Better

Greencore (our change programme), and

he is already bringing real thought leadership

to how we can step change our approach

right across our operation.

Another key appointment, at the beginning

of November, was that of Damien Moynagh

as General Counsel and Group Company

Secretary. Damien will lead Greencore’s

Legal and Company Secretariat functions

and he brings with him over 20 years’

experience as a corporate lawyer and senior

executive across Europe, the United States

and Asia.

Lee and Damien both bring a whole wealth

of experience and knowledge to Greencore

and are great additions to our Executive

team.

Q: What is your focus

looking forward?

A: In the near-term we know there are some

things that we just must get right – we’ve

got to continue to engage constructively

with our customers to deliver inflation

recovery, we’ve got to work on simplifying

our operation to drive efficiency and build

margin and we’ve got to rigorously manage

our cost base. We’ve got to do this in a way

that continues to engage and energise the

14,000 people who come to work for us

every day.

Longer term, there is a lot of potential to

unlock in the business. We know we’ll have

a journey to go on to deploy a world-leading

operational excellence model, and this

will require us to build out our technology

capability. As the new team settles in,

we’ll also want to take the time to look

in a considered way at our portfolio of

customers, categories and assets to build

a strategy that will enable us to not only

recover our historic levels of margin but

to generate profitable growth beyond this.

We will be working hard on this in the

months ahead as a team.

Finally, I am also very much looking forward

to welcoming Leslie Van de Walle, who joins

us as Chair Designate on 1 December.

Dalton Philips

Chief Executive Officer

28 November 2022

Adjusted Operating Profit

£72.2m

Adjusted EPS

9.2p

14 Greencore Group plc Annual Report and Financial Statements 2022

£20bn

total food to go

market value

best-in-class partner

agencies

reputable agency

sources providing

continuous end point of

sale, loyalty, panel and

market data

4m+

responses by consumers

to bespoke questions

on our survey platform

20+

individual topics

discussed with

consumers in our

proprietary community

c.1,190

active members of

our online consumer

community

Source: internal Greencore insight teams

Capturing insights and data

We have a dedicated team of insight and category professionals

reviewing multiple sources of market, shopper, and consumer

intelligence daily to unlock key insights. We actively seek out,

analyse, and interpret relevant information to drive and activate

category strategies and innovation.

We track, measure and report on data and insights to give us

both a top-down and bottom-up view of the themes and trends

impacting our business and categories. We work in partnership

with numerous best-in-class agencies providing us with an

extensive and varied portfolio of insight resources. We work hard

to understand all variables by analysing end point-of-sale, loyalty,

and panel data to understand granular shopper behaviour

(the what) and we overlay this with our proprietary quantitative

and qualitative consumer and shopper research to understand

sentiment, and motivations (the why).

Key trends

Market trends

influencing

our business

Busy lifestyles

Sales of Greencore’s categories are driven predominantly by the need

for convenience. There has been a continued movement out of

home post COVID-19, which has resulted in a more intense pace of

life. The underlying trend of increased mobility and time spent away

from home is unlikely to reduce in the short term, especially as more

people look to take on overtime or second jobs to cope with falling

discretionary income.

Food for now categories have always had widespread appeal as a

convenient food solution, and frequent buyers have always been

more likely to be working in multiple locations, working from home,

or working shifts or long hours.

Treat and reward

Treat occasions continue to play an important role across our

categories. Far from making us batten down the hatches, the

pandemic and now the cost-of-living crisis has encouraged people

to be kind to themselves through treating. Food is essential to

satisfying emotional needs, calming stress levels, and reducing

anxiety, and is a relatively low-cost, low-risk treat. Despite the

cost-of-living squeeze, people will still look to treat themselves.

Consequently, product ranges that fulfil these treat needs are

important for both at home and on-the-go occasions.

15Strategic Report | Directors’ Report | Financial Statements

Healthy and sustainable diets

As people are increasingly striving to eat more plant-based foods,

flexitarianism looks set to become the prevailing diet of the future.

People generally find health and sustainability confusing, and they

look to retailers and manufacturers to support and guide.

Manufacturers and retailers will play their part by delivering tasty

products with minimal impact on people and the planet.

Moving towards diets that align more closely with healthy-eating

guidelines, including less meat and more vegetable-based foods,

will also offer environmental benefits. Despite the overall reduction

in meat consumption to date, for Greencore to reach its sustainability

targets will require a substantial acceleration of this trend.

Our healthy and sustainable diets policy details four pillars that guide

and influence our product development; 1) positive health, 2) product

reformulation, 3) more vegetables and 4) the future of protein. We

give more detail on our approach to healthy and sustainable diets in

the Sustainability section on page 25.

Cost-of-living impact

We are currently in a period of high inflation, which puts pressure on

all parties when it comes to food prices. Alongside energy price

increases, there is a lot of consumer focus on the cost-of-living crisis

in the UK. People are feeling the effects and subsequently looking to

tighten their spending habits.

Money continues to be the dominant concern, with 75% of people

asked in our research claiming to be worried about their finances.

Our market research indicates that whilst consumers still value treats

and rewards, they will become ever more responsive, adapting their

shopping habits to deal with financial challenges as they arise. They

will employ money-saving tactics so they can continue buying into

the categories they enjoy. People will be willing to invest more time

planning their shopping, including the use of multiple stores and

channels, if it means they are saving money.

16 Greencore Group plc Annual Report and Financial Statements 2022

Our strategy is built upon the three pillars

of Growth, Relevance and Differentiation.

Our growth is underpinned by consistently seeking

to operate and win in categories, channels and with

customers that outperform the overall food market.

Our ability to do this is based on ever-increasing

relevance both to our customers and the end-consumer,

grounded in the quality of the products we produce and

the depth of the relationships we build.

We differentiate through a distinctive, repeatable

Greencore way of working that draws on four critical

elements – a recognition that our People are at the

Core of our success, our unrelenting commitment to

producing Great Food, an aspiration for Excellence in all

that we do and a commitment to continuously improve

the Sustainability of our business.

Our

Strategy

strategy

Growth

Our leadership positions in attractive and structurally growing

food categories underpin a strategy that combines strong organic

growth potential with disciplined strategic investment.

Relevance

Our model of embedded, long term customer partnerships

is the cornerstone of our commercial offering, ensuring

we are strategically relevant for our customers.

Differentiation

Our comprehensive capability set provides us with a distinctive

and repeatable Greencore way of working, to ensure we exploit

potential growth opportunities.

Progress

• Pro Forma Revenue Growth of 29.4% in FY22

• For FY22, reported revenue in the Group’s food to go categories

increased by 37.9% versus FY21 and in the Group’s other

convenience categories increased by 19.8% versus FY21

• Growth supported through a combination of existing business

and onboarding of new relationships

Read more on page 10

Outlook

• Continue to build an inclusive and diverse working environment,

underpinned by our safety culture, that is attractive and can

develop existing and future colleagues

• Further embed sustainability into processes, behaviours

and capabilities across the business

• Invest further in automation solutions to reduce labour reliance

and build margin

• Continue to develop our food portfolio whilst ensuring we are

positively socially impactful as a business.

18 Greencore Group plc Annual Report and Financial Statements 2022

Building a

Strategy

This is a change programme launched in FY22,

with the aim of addressing three interrelated

challenges – our rising fixed cost base; our

ability to fully service our current portfolio from

our existing asset base at appropriate margin;

and the relative immaturity of our technology

infrastructure.

By addressing these challenges, we will build a better

business: 1) for our customers, with greater efficiency

enabling us to build more competitive offerings, as well as

a more integrated engagement model to support shared

growth and margin aspirations; 2) for our people, with

faster decision making, simplified processes and a clear

organisational model empowering them to do their best

work, and, 3) for shareholders, with efficiencies driving

enhancement to our profitability, margin and returns.

Through H1 FY22, we developed our improvement plans,

with particular focus on managing our cost base, as well

as tactical interventions to better utilise and extend our

sandwich and ready meal capacity. Across these areas,

we are targeting delivery of £30m of annually recurring

benefit in FY24. To unlock these improvements, the Group

will invest a total of approximately £24m comprising of

operating and capital costs of which £16.1m has been

incurred in FY22. We progressed well against these plans

in the year. In particular, we transitioned our organisational

model from a matrixed structure, to an integrated

organisational model with clear functional leadership

and accountability. We also delivered a number of

cost-focused initiatives, which helped us in managing

costs in the most inflationary environment our business

has ever seen. On capacity, the interventions we made

enabled us to deliver strong customer service through

our busy summer period.

Going forward, our focus will be on continuing to deliver

the first phase of the programme including ongoing

initiatives on people, fixed cost and capacity. Further

phases of work, notably on operational and technological

excellence are in development and we aim to launch

these during FY23.

Better Greencore

19Strategic Report | Directors’ Report | Financial Statements

20 Greencore Group plc Annual Report and Financial Statements 2022

“Food is at the heart of what we do,

and we recognise that as a convenience

food leader we have an important role

to play in improving food for both

people and planet.”

Andy Wright

Head of Sustainability

Sustainability

What we eat matters. By making products

that are nutritious, affordable and taste great

we make it easier for people to make choices

that are good for their health and wellbeing,

support local communities, and reduce the

impact of food choices on the natural world.

For us, the concept of ‘better’ is about

making a meaningful difference for all

our stakeholders – whether they are

end-consumers, shareholders, customers,

colleagues, the communities in which

we operate, or the wider planet. From the

outset, we deliberately set out to align our

purpose with our sustainability strategy to

ensure doing the right thing is part of our

business DNA. We want to do our part to

ensure the future of the planet is a better

one. This is why we have named our

sustainability strategy our Better Future Plan.

Our Better Future Plan consists of three

interlocking pillars: Sourcing with Integrity;

Making with Care; and Feeding with Pride;

encompassing both our environmental

and social commitments. Our strategy helps

us define the key delivery plans we need

in order to progress and also defines the

foundations we need to work on to support

the rest of the strategy.

Plan

Our Better Future

21Strategic Report | Directors’ Report | Financial Statements

People at the Core

Foundations

Governance Risk management

Transparency

(data and reporting)

Embedding

(communications

and upskilling)

Climate transition

Responsible sourcing

We will source sustainable ingredients

with transparency by holding ourselves

and our suppliers to the same high

standards of integrity.

Human rights

We respect the human rights of

everyone who works for, and with us.

Net Zero

We will use less to make more by

becoming more resource-efficient

and operating a Net Zero business.

Food waste

We will halve food waste within our

operations and work with others to

minimise waste in our supply chains.

Community

We will invest in our local communities

by working to alleviate food poverty

and providing economic opportunity.

Healthy and sustainable Diets

We will design products with health,

affordability and sustainability in mind;

by identifying where the best

opportunities are to meet all three

requirements, while not

compromising taste.

Sustainable packaging

We will ensure our packaging has the

lowest planetary impact by making

it easier to recycle and eliminating

single-use plastic.

Delivery Plans

Iegry

Sourcing with

Care

Making with

Pride

Feeding with

By 2040, we will operate

(Scope 1 & 2) with Net Zero

emissions

By 2030, we will have

increased our positive

impact on society

through our products

By 2030, we will source

our priority ingredients

from a sustainable and

fair supply chain

Our standalone Sustainability Report

for FY22, part of our Better Future

Plan, will be released in January 2023;

previous reports can be found at:

https://www.greencore.com/

sustainability/sustainability-hub/

22 Greencore Group plc Annual Report and Financial Statements 2022

Year

Sustainability continued

We have made good progress on our

foundations: data; embedding; and risk

analysis; but this is not yet flowing through

to absolute reductions in our carbon

footprint. We are looking at ways to

accelerate delivery, and we also continue

to focus on collaboration to drive the

systems level change required.

This year, we refreshed our materiality

assessment as part of our two-year review

cycle to ensure we keep pace with the

ever-evolving sustainability landscape.

Our materiality assessment aims to identify

and prioritise the most important sustainability

issues for our business. The development

of our Better Future Plan was informed by

identifying the areas that are most material

to our stakeholders and ensuring alignment

to the UN Sustainable Development Goals.

We have aligned our FY22 assessment

with the double materiality approach by

considering materiality through two lenses,

the external impact and the business impact.

We engaged 43 stakeholders through a

combination of surveys and interviews.

We also held 18 deep-dive interviews with

subject matter experts to gather qualitative

insight on the material topics as well as on

Greencore’s performance and opportunity

areas. This insight has been used to update

our overall materiality assessment and to

inform the prioritisation of actions for us

across a broad strategy.

We have worked on improving transparency

and increasing disclosures in our reporting.

We have completed detailed scenario analysis

as part of our climate risk analysis, following

Taskforce on Climate-related Financial

Disclosure (‘TCFD’) guidelines and assessing

sustainability risk is an area we have built into

our overall assessment of business risk. We

are gaining real insights from this analysis

which develops our thinking on helping to

build a resilient business. Further details on

our climate action are detailed in the

Sustainability section on Climate transition

on page 29.

Our sustainability planning has developed significantly over the last two

years, and we’re now well on our way to embedding sustainability as part

of our everyday business.

in review

Our total carbon footprint is made up of

emissions from our direct operations (Scope

1 and 2), which represents 6% of our total,

while our indirect emissions (Scope 3) from

the ingredients we source and the products

we place on the market represent the

majority (94%) of our total footprint. The

most significant reductions will therefore

come from collaborating with our customers

and suppliers to reduce our indirect Scope 3

emissions, notwithstanding this we recognise

the importance of Scope 1 and 2 and are

continuing to look to accelerate our plans

on energy reduction.

We have made good progress on

collaborating with customers; the nature

of our business means we are significantly

influenced by our customers’ strategies and

behaviours. Our product footprinting trial

has been successful and showed us how to

eco-score an entire category, rather than an

individual product. This has huge potential to

give us the data we need to make decisions

on product formulations. We recognise that

we need deeper conversations with our

customers in order to make this happen,

and we are preparing for those discussions

by gathering both detailed market insight

and robust internal data.

Looking ahead, we need to move from

planning to delivery. Our sustainability

initiatives are now sufficiently matured to

allocate ownership to specific roles, and we

are embedding accountability with individual

executives, which will in turn support a

remuneration framework. We have also

refreshed our governance model for

sustainability to support the next phase of

business ownership and delivery, including a

change to executive governance for FY23 to

include a regular sustainability review with

the Group Executive Team.

We are also working to broaden sustainability

capability and knowledge across the

business, upskilling our teams and exploring

avenues to partner with customers to help

elevate their expertise too, which will in

turn help to bolster our activities. Given

the current wider global difficulties, we

recognise that we are likely to face a very

challenging macro-economic environment

for several years to come, but believe

that it is because of these challenges that

sustainability is more important now than

ever. We are confident that Greencore’s

sustainability strategy will play a crucial role

in the long term and continued success of

the business.

23Strategic Report | Directors’ Report | Financial Statements

Sourcing

Responsible sourcing

Our products are made from ingredients

sourced from around the world. We have

a significant global supply chain which we

hold to high standards of accountability and

transparency, so we make it our business

to know where our ingredients come from,

how they are produced, the impact they

have on the environment, and the long term

challenges their use may pose to the

business, such as rising costs and tougher

access to key commodities.

We aim to responsibly source 100% of our

priority raw materials by 2030. In order

to achieve this aim, we define what both

‘responsibly sourced’ and ‘priority raw

materials’ mean for us, which we determine

through a process of risk, and update

annually.

It’s not possible to take a ‘one size fits all’

approach to ingredients – each individual

supply chain comes with its own challenges

around biodiversity, climate change, water

scarcity, deforestation and animal welfare –

and we have different levels of control over

each, depending on whether they are a

priority raw material or a traded commodity.

However, our sustainability risk assessment

model enables us to identify and take action

on hotspots identified throughout our

supply chains. We are focusing on priority

ingredients that carry the greatest sourcing

risks from three areas: forests, fisheries

and field.

For forests, we are committed to eliminating

deforestation and ecosystem conversion in

the sourcing of soy, palm oil and timber.

For palm oil ingredients within our core

operations, 100% are from Roundtable

on Sustainable Palm Oil (RSPO) certified

sources. In addition to our core business,

we also own a subsidiary business, Trilby

Trading Ltd, whose core activity is vegetable

oil trading in Ireland. The majority of the oils

Trilby trade are palm oil, of which 10% are

from RSPO certified sources (segregated and

mass balance combined). For soy, we are

signatories to the UK Soy Manifesto – a

collective industry commitment to ensure all

physical shipments of soy to the UK are

deforestation and conversion-free by 2025.

We are working with suppliers to set

individual transition plans to ensure we meet

this commitment.

For fisheries, we aim to source all our wild

fish sustainably, with 100% of our tuna

sourced from pole and line fishing, Marine

Stewardship Council (‘MSC’)-certified

fisheries or from those with a Fishery

Improvement Project in place. Meanwhile,

100% of our cold-water prawns are from

MSC fisheries and 100% of our warm-water

prawns are Best Aquaculture Practices 4 star.

In the field, 100% of our fresh produce raw

materials are grown in accordance with Red

Tractor (UK) or Global GAP (rest of the world)

standards for good agricultural practice. This

means that the farmers and growers that

supply us work to control their use of

agrochemical inputs and fertilisers, and

consider the environmental impacts of their

farming practices. Our growers demonstrate

that they are meeting these standards through

independent third-party audits conducted by

accredited providers. These schemes ensure

our fresh produce raw materials do not have

unnecessary impacts on the environments in

which they are farmed.

Human rights

We’re committed to championing

internationally recognised human rights

standards and safeguarding the people who

work for us, with us, and who are affected by

our activities around the world. Child, forced,

and compulsory labour remains a serious

concern in many of the countries where our

ingredients originate. Such cases are often

hidden due to the complexity of global

supply chains, and while we have not been

made aware of specific cases to address

within our operations, this does not mean

that the problem does not exist.

Under the UN Guiding Principles on Business

and Human Rights, companies are expected

to actively demonstrate that they do not

infringe on human rights through their

operations or business relationships. As such,

we undertake ethical risk assessments of our

raw materials to identify areas within our

supply chains that are most at risk of human

rights abuses, including modern slavery. This

model is based on outputs from the Food

Network for Ethical Trade Risk Assessment

Tool and is applied in a ‘double-analysis’

approach that considers the country of

manufacture for all the foods that we buy,

including the country of origin for the

ingredients. This data is used as part of our

supplier engagement work to ensure we

focus on high-risk areas.

We work hard to ensure that everyone is

treated fairly within our global food supply

chains, and we also take direct action on

human rights abuses when we uncover

them. This requires a collaborative effort

from everyone in the food industry, which

is why we have joined a number of initiatives

including the Modern Slavery Intelligence

Network, the Food Network for Ethical

Trade, and Stronger Together, so we can

actively help prevent and disrupt human

rights abuse at its source. We are dedicated

to improving the lives of those who have

experienced modern slavery where we can,

and have partnered with the Bright Future

programme to help survivors access

safe, secure work at a Greencore site

of their choice.

For more information on our approach to

social sustainability and to read our FY21

Modern Slavery and Human Trafficking

Transparency Statement, please visit

www.greencore.com.

with Integrity

24 Greencore Group plc Annual Report and Financial Statements 2022

Making

Energy efficiency

Reducing greenhouse gas (‘GHG’) emissions

through intelligent energy use will help us

transition towards a Net Zero future. We have

committed to science-based targets to help

guide us to succeed, and we are continually

monitoring our use of energy and water to

assess our progress.

The obvious challenge in the last 12 months

has been the ongoing impact of production

change post the COVID-19 period, and as our

production levels have increased our energy

use has increased also. This has resulted in

increases in certain key metrics and targets

versus our base year, as shown in the

Metrics and Targets section on page 33

and described below.

In FY22, in absolute terms our total gross

Scope 1 and 2 carbon emissions increased

from the previous year from 90,278 tonnes to

92,655 tonnes, an increase of 2.6%, and from

our base year of 89,606 tonnes an increase

of 3.4%, as a result of increased production

levels. In contrast as a relative measure,

as our overall production levels increased our

manufacturing energy intensity ratio (kWhp/

tonne) decreased from 1,315 kWhp/tonne

to 1,254 kWhp/tonne, an improvement of

4.6% in our efficiency.

Our Net Zero plan has focused on three areas

of activity that each help populate our overall

delivery plan:

• Data and insights: ensures we have the

right data and KPIs in place to focus

activity and drive improvement. It also

involves the auditing of our sites to ensure

we are identifying the right projects

to implement.

• Brilliant basics: ensures we have the right

information available to our site teams

to enable best practice actions to be

implemented, and ensures we are

sharing information on how best to

manage energy.

• Step change projects: defines Group-

wide projects for delivery, including the

scoping of significant projects on solar

technologies.

Food waste

We are committed to reducing food waste by

50% by 2030. Food waste is a global problem

and highly material to our business. By

reducing food waste, we can help improve

food security and mitigate the effects of

climate change, while driving efficiency

benefits for the business. We measure food

waste as a KPI against our total food handled.

This data is used to evaluate performance

and review progress against our UN SDG

Friends of Champions 12.3 commitment

which will see us targeting a 50% reduction

in food waste by 2030 against a FY17

baseline year. Our food waste baseline year

of FY17 differs from our scope 1, 2 and 3

carbon emissions baseline year of FY19 due

to reporting in line with the food industry

collaborative programme, the UK Food

Waste Reduction Roadmap.

In FY22, our food waste, measured as a

percentage of the product and ingredient

handled, was 8.48%. This is an increase from

last year’s performance at 8.06%, primarily

due to the simplification of ranges during the

period of COVID-19. However, to date we

have achieved an 11% reduction from our

base year (FY17) in food waste as an overall

percentage of food handled.

Community

Our business depends on the communities in

which we operate. We can only be as healthy

and sustainable as they are, so we see it as our

responsibility to actively engage with and

support our local communities however we

can. Food is the heart of our business and we

strongly believe that everyone should have

access to good food. Food has a significant

impact on health, wellbeing and

development, and can help to build friendlier,

stronger, healthier communities. The

extremely challenging current economic

situation means this is now more important

than ever.

Food donation continues to be a central focus

for our community engagement efforts. We

work with a number of food redistribution

organisations – including FareShare, The Felix

Project, The Bread and Butter Thing, and the

Trussell Trust – in order to ensure our surplus

food reaches those who need it. Through

these partnerships we are able to redistribute

short shelf life, chilled, frozen, and bulk

products, as well as any surplus from new

product trials. In FY22, we redistributed the

equivalent of 1.63m meals.

In 2022, we passed a milestone of the

redistribution of the equivalent of 4m meals

to FareShare during our partnership and were

awarded FareShare’s ‘Leading Food Partner’

status, celebrating businesses who have

shown commitment to diverting surplus

food to FareShare to provide meals for

people in need.

This year has also seen us continue our

partnership with Ingredients 4 Life in

collaboration with City Hearts. This initiative

teaches cookery to survivors of modern

slavery, equipping them with life skills,

self-confidence and providing a safe space

in which to build trust in others.

with Care

Sustainability continued

Reduction from our base year in

food waste

11%

Number of surplus meals

we redistributed in FY22 the

equivalent of

1.63m

1 https://champions123.org/

25Strategic Report | Directors’ Report | Financial Statements

Feeding

Healthy and sustainable diets

We want our products to taste great, but also

be better for people and the planet too. This

means taking positive steps to make sure our

meals form part of a healthy balanced diet as

well as ensuring our processes and products

contribute to a sustainable future.

Transforming our product portfolio is central

to this endeavour, particularly in addressing

our Scope 3 emissions and those of our

customers. We are predominantly an

own-brand manufacturer, producing

products on behalf of our customers and

therefore it is imperative that we work closely

with our customers on their own policies to

deliver joint goals. Collaboration is key in

moving forward and enabling the

development of lower impact products.

Healthy and sustainable diets have been a key

focus for us this year, in particular the use of

data to help guide our delivery plans. Our

health score is based on the UK Government’s

Nutrient Profiling Model (‘NPM’). The NPM

was developed to review the composition

of foods, balancing the value of nutrients

that are important to the diet against those

deemed not to be. Whilst the government’s

approach is specifically linked to certain

categories, we have applied this against our

total portfolio of products and have classified

products with an NPM <4 as ‘healthier’.

Our analysis shows that 80% of volume sales

are from products with an NPM score of <4.

In addition, this year for the first time we are

able to report on animal and plant-based

protein, in line with the World Wildlife Fund

for Nature (‘WWF’) Protein Disclosure Guide.

The WWF Basket tracks retailers’ progress

toward halving the environmental impact

of the average UK shopping basket by 2030.

Sustainable diets are a core part of achieving

this, and we are monitoring progress on

rebalancing animal and plant protein sales.

Our analysis of the percentage volume sales

(tonnes) from animal and plant-based protein

sources shows us that 69% of our products

are meat-based, 24% are vegetarian, and 7%

are plant-based (vegan). In future, we will

look to increase the granularity of our data.

The principal way Greencore can rebalance

protein is not simply through increasing sales

of vegan products, but by reducing animal

protein content within existing products.

However, we will need to be able to measure

the change in protein content in each product

for this to be visible, rather than the overall

amount of products that fall into a category.

During FY22 we have relaunched a small

number of reformulated products focusing

on improved health and sustainability

measures, which we are monitoring closely

for customer sentiment. We have also

been working with suppliers to identify

opportunities for dairy reduction through

alternative ingredients. Concentrated cream,

for example, is a natural product that retains

the flavour and mouthfeel of cream whilst

having a lower dairy content.

Product footprinting is central to our work on

healthy and sustainable diets. We are currently

trialling product footprinting technology with

Tesco and Mondra, enabling us to conduct

eco-accounting at scale through the

footprinting of a large number of products

at pace. We are able to model sustainability

impacts across carbon, water usage, water

pollution and biodiversity for an entire

category. In addition, the software allows

us to create a formulation footprint for

each individual product, and then creates

a ‘digital twin’ of that product, allowing us

to experiment with different ingredients and

formulations to see the potential impacts

of different recipes.

In addition to our work on product

footprinting, we also sit on the steering group

for the Institute of Grocery Distribution (‘IGD’)

programme to create a harmonised approach

to environmental labelling for the UK food

industry. This work has involved a collaborative

project to test a series of prototype labels

with Pride

26 Greencore Group plc Annual Report and Financial Statements 2022

with consumers in a virtual reality

environment.

Looking ahead, we recognise sustainable

diets as a key part of Greencore’s future and

hence, we wanted a platform that helps us

future-proof our business, quantify and

translate future macro trends, support

and enable complex cross-functional

workstreams and bring robust, sustainable,

insight-led innovation to our customers – part

of this new platform is our newly established

Future Food Team. Healthy and sustainable

diets is a key enabler to their team strategy,

working in partnership with the Sustainability

Team to ensure every new project or material

we bring into Greencore has been through

our ‘sustainable diets’ rule set, ensuring we

have clarity and visibility of the alignment

with our broader plan in this space.

Packaging

Consumers increasingly expect retailers

and manufacturers to take bold action on

packaging, so it is up to us to find solutions in

which performance, cost and sustainability

can work together. We are working hard to

change the way we package our products,

looking at what we use to make our

packaging, and what happens to it after

it has done its job. We are setting challenging

goals and targets to reduce the amount of

packaging we use and the impact it has, as

well as making sure it never becomes waste.

Our packaging policy defines a ‘less and

better’ roadmap made up of three focus

areas: remove, reduce and recycle.

This year, we have made improvements

across all of our product categories. Within

salads, we have redesigned our existing salad

trays with a ribbing feature that uses less

plastic, while adding additional strength.

This change equates to 30 tonnes of material

savings per year.

Within ready meals, all of our oven-safe meal

trays are detectable for recycling and contain

a high degree of recycled plastic, and this

year, where possible, we switched our

microwaveable meal packaging to this

formula. This delivers a significant plastic

tonnage saving through the change of lidding

film and rigid thermoformed trays. The

reduction of more than 5.5m bowls from

a customer range is a great example of

this switch, which will save eight tonnes

of plastic a year.

Our sushi offer presents a unique set of

challenges as these products are often

regarded as a premium choice by consumers

who want to be able to see the individual

sushi pieces before purchase. As such,

any changes to the product’s lid need to be

carefully considered. While the existing lid is

made with at least 50% recycled plastic, we

have now created a hybrid pack that includes

a cardboard tray. We’ll be pursuing other

options in the future as we continue to

explore consumer expectations with this line.

Last year, we developed the first-to-market

truly recyclable paper sandwich skillet.

Following a successful launch, we continue

to investigate ways of improving this pack

further. Similarly, we are continuously scoping

out opportunities to make our moulded

plastic soup and sauce pots lighter in weight,

as well as exploring new technologies to

incorporate food-grade recycled plastic into

this packaging line.

Sustainability continued

27Strategic Report | Directors’ Report | Financial Statements

Embedding a Safety Culture

The health, safety and wellbeing of our

colleagues and visitors is our top priority. We

are continually working to improve the safety

of all our working environments, and we are

committed to developing a culture that puts

physical and emotional wellbeing at the

heart of our business. Our colleagues’

health, safety and wellbeing is critical to

the success of our business and we pursue

a comprehensive Health and Safety strategy

which includes priorities, action plans and

performance objectives for every area

across the business, and accounts for legal

occupational health and safety requirements.

While COVID-19 has not disappeared, in

FY22 we moved into a new chapter of ‘living

with COVID’. This has allowed us to remove

many of our controls, however we have

continued to practice good personal hygiene

and to take up vaccinations when offered.

We also recognise that COVID-19 and

the cost-of-living crisis has taken a toll on

mental health and wellbeing. We continue

to partner with GroceryAid, a charity offering

emotional, financial and practical help to

colleagues in the grocery industry. Site-

specific information, advice, guidance and

counselling is provided to colleagues who

may need it via a specially developed internal

resource called Talk2Us, and we also run

quarterly wellbeing webinars which have

been very well received by those attending.

Overall, our Reportable Accident Frequency

Rate (‘RAFR’) has shown an improvement

from 0.37 in FY21 to 0.33 (per 100,000

hours) in FY22.

Inspiring leadership

We are continuing to build a culture that

enables our people to achieve their potential

by embracing difference, building the

capability of our leaders, and harnessing the

power of a diverse workforce that represents

our customers and consumers.

We continued to invest in management and

leadership capability and saw circa 200 of

our team leaders complete a professional

development programme, directly and

positively impacting our colleagues’

experience at Greencore. We launched

our high-performing teams programme

designed to help our senior leaders

be effective, along with our extensive

involvement in ‘reverse mentoring’ in the

sector to help our leaders better understand

the barriers underrepresented groups

may have. We have seen marked gains in our

Manager Index, with individual improvement

in areas such as ‘managers and leaders

showing respect and care’ up by 14%

compared to the previous survey

Our early careers investments continued

to grow to help us ensure skills and talent

for the future. We continually assess the

competitiveness of our pay and benefits

to attract and retain the best talent, having

introduced a benchmarked job architecture

to provide clear career pathways for our

people. Our internal hire ratio, currently 44%,

continues to improve as we develop and

grow our own talent.

Engaging and effective teams

76% of our colleagues participated in our

annual ‘People at the Core’ engagement

survey and our overall engagement score

rose by two percentage points in FY22,

despite significant changes in the organisation

and challenges in our external environment.

We have over 14,000 colleagues who are critical to the success of our business.

People at the Core is at the centre of The Greencore Way. Our people strategy has three

pillars – Embedding a Safety Culture; Inspiring Leadership; and Engaging and Effective Teams.

Internal hire ratio

44%

People

at the Core

28 Greencore Group plc Annual Report and Financial Statements 2022

Gender diversity

Across the Group

FY22 61% male 39% female

FY21 60% male 40% female

At Board level

FY22 40% male 60% female

FY21 45% male 55% female

At Group Executive Team level

FY22

71% male 29% female

FY21 57% male 43% female

At Group Executive Team direct reports level (-1)

FY22 56% male 44% female

FY21 54% male 46% female

Sustainability continued

Inclusion and Diversity (I&D)

We believe we can ultimately differentiate

our business through our colleagues, so it’s

important to us that we create a culture

where our people can be themselves and

fulfil their potential. By focusing on inclusion

and diversity, we can make better business

decisions informed by diverse perspectives.

We can better reflect our customer and

consumer needs, and therefore better

anticipate change and respond with agility.

And we can rely on a capable, cohesive

colleague base, which feels valued

and motivated to progress and drive

our business.

Greencore is already an incredibly diverse

organisation, and it is important for us to

ensure that everyone’s experience of

working with us is one of inclusion, because

we know that diversity doesn’t work

without inclusion.

Our Inclusion and Diversity strategy sets our

agenda. In 2021, we undertook a significant

review of our cultural environment, exploring

the diversity of our colleagues along with

their lived experience of inclusion at

Greencore. We spent time with over

1,000 colleagues – 100 in greater depth –

across 20 listening groups, hearing stories,

experiences, and feelings about Greencore.

This led to the creation of the strategy,

sponsored by our Chief People Officer,

and led by our Head of Talent, Development

and Inclusion, supported by our Inclusion

Manager.

Attracting and retaining young talent is a

focus for us and we aspire to bring more

young talent into Greencore through our

investment in both early careers and

entry-level roles. We’re pleased to have

been accepted as part of the Good Youth

Employment Charter, through which we

have pledged to create more opportunities

for young people and support those in

underprivileged areas. We have also

partnered with the Institute of Grocery

Distribution (‘IGD’) to build and pilot a

reverse mentoring scheme, enabling senior

mentees and their reverse mentors from

different, non-competing companies to

open authentic discussions on inclusion

and diversity.

At the end of the financial year, 39% of all

colleagues were female. Our male-to-female

percentage ratio is 40/60 at Board level,

71/29 at executive-level, and 56/44 at the

Group Executive Team’s direct-report-level.

While the Group remains committed to

gender diversity, as a result of a challenging

labour market and the delivery of an

organisational restructure, our gender

diversity statistics have decreased since FY21

across the Group and at Group Executive

Team level in particular. The Group continues

to review gender diversity as a key metric,

and as a founding member of the 30% Club

– which strives for 30% of leadership

positions to be held by women, we commit

to keep driving progress in this area paying

particular attention to understanding and

tackling unconscious biases.

Perentage of female colleagues

39%

Male to female ratio at Board level

40/60

1 The male to female percentage ratio of the current Group Executive Team at the date of this Annual Report is 87/13.

29Strategic Report | Directors’ Report | Financial Statements

Taskforce on Climate-related Financial Disclosure (‘TCFD’)

Climate

transition

Introduction

Climate change is anticipated to impact

our business over the short, medium and

long term. Physical risks may impact our

operations and supply chain through extreme

weather events, such as flooding or droughts.

Transitional risks as a result of moving to a

low-carbon future may impact us through

changing consumer preferences or climate-

related regulation. Climate change also

presents opportunities for us, such as the

higher sales of lower GHG emission products.

To keep us on course, we established science

based targets, which are externally verified by

the Science Based Targets Initiative (‘SBTi’).

Under this programme, we have pledged to

reduce absolute Scope 1 and Scope 2

emissions by 46.2% by 2030 from a 2019

base year, and to reduce Scope 3 emissions

from purchased goods and services, and

upstream transport and distribution, by 42%

per tonne of product sold by 2030, from a

2019 base year. We assess our performance

against long term targets and short term key

performance indicators.

We complete an annual carbon footprint

analysis across our business. This data enables

us to determine more granular emissions

profiles across our product categories to

inform our strategy and risk management

process. Our baseline Scope 3 footprint has

been determined using carbon factors from

published average carbon footprint data for

individual raw materials. We intend to

continue honing our Scope 3 footprint by

refining supply chain carbon data with a view

to replacing industry carbon factors with

specific live data for key hotspots.

In FY22, our total gross Scope 1 and 2 carbon

emissions increased from the previous year

from 90,278 tonnes to 92,655 tonnes, an

increase of 2.6%, and from our base year of

89,606 tonnes an increase of 3.4%. While

FY22 did not see us reduce our Scope 1 and 2

emissions, we remain committed to achieving

net zero by 2040. Our total Scope 3 footprint

for FY22 is 1.48 (m tonnes of CO

e), an

increase on the previous year (1.33m tonnes )

which was impacted by lower production

volumes during COVID-19, but a decrease

from our FY19 base year of 1.61MT by 8.1%.

Our performance data is outlined in full on

page 33.

Following our initial disclosure in November

2021, this year was our first year conducting

scenario analyses to estimate the potential

impact of climate risks and opportunities.

Now we have completed scenario analysis

for the first time, future analysis will look

at potential mitigation strategies as part of

our strategic planning, and the next phase

of scenario analysis will include modelling of

the impact of changing consumer patterns.

Listing Rule 9.8.6R Compliance

Statement

Greencore plc has complied with all of

the requirements of LR 9.8.6R by including

climate-related financial disclosures in this

section (and in the information available at

the locations referenced therein) consistent

with the TCFD recommendations. Our

sustainability report for FY22 is to be released

in January 2023 as a standalone report; all

TCFD related disclosures are included in this

Annual Report.

Governance

Greencore’s corporate purpose and

sustainability strategy are set by the Board.

Our Board monitors our overall sustainability

performance against our stated ambition and

targets. The Board also reviews potential

risks and opportunities associated with our

sustainability strategy and corporate purpose,

and set and monitor progress against our

climate related metrics.

In addition, the Board oversees our Better

Future Plan, which includes climate-related

matters, which is one of our core strategic

business priorities. A sustainability update is

provided at each scheduled bi-monthly

Board meeting by the Head of Sustainability,

where climate impact and action, a core

element of our sustainability strategy, is

discussed, alongwith progress towards

targets and key performance indicators.

The Chief Executive Officer has responsibility

for overall performance of the Group, which

includes sustainability governance. Non-

Executive Director, Helen Rose, is the Group

Sustainability Engagement Director and is

the Board’s sustainability champion. Helen

is responsible for reviewing the Group’s

sustainability objectives and performance,

including the delivery of the Group’s

sustainability strategy, as well as providing

updates on progress on sustainability matters

to the Board.

The Group has established a Sustainability

Steering Committee comprising leaders

from various functions within the Group.

The Sustainability Steering Committee has

overall responsibility for the delivery of our

sustainability strategy, and specific oversight

of our overall climate strategy. The Committee

feed into the bi-monthly Board update

provided by the Head of Sustainability,

and review climate related performance

objectives.

Reporting to this Committee are six

Sustainable Business Management Groups

(‘SBMGs’) that provide a cross-functional

forum to develop and steer our strategy

at an operational level. The SBMGs cover

responsible sourcing and human rights,

ethics, energy and environment, packaging,

communities, and healthy and sustainable

diets. These steering groups are chaired by

senior leaders. Performance reviews and key

Greencore

Group plc

Board

Non-executive

Sustainability

Engagement

Director

Sustainability

Steering

Committee

Responsible sourcing

and human rights

Communities

Ethics

Packaging

Energy and

environment

Healthy and

sustainable diets

Governance framework

Sustainable Business

Management Groups (‘SBMGs’)

30 Greencore Group plc Annual Report and Financial Statements 2022

TCFD continued

decisions are passed up the governance

hierarchy, initially to the Sustainability

Steering Committee, and then to the Board

via bi-monthly reviews.

The SBMGs meet at least four times a year

to exchange knowledge and best practice,

to align strategic thinking and to provide

recommendations for the Sustainable

Steering Committee to consider. Each

SBMG is made up of senior executives and

functional teams who are responsible for

driving action across all tiers of the business

through the implementation of specific

improvement plans. The day-to-day

management and coordination of activities

in relation to climate risk is carried out by the

Head of Sustainability and the wider

sustainability team.

Risk type Description

Time

horizon Risk/Opportunity description

Potential mitigations that are

being considered as part of

our strategic planning

Physical

risk

Chronic climate change

• Changes in precipitation

patterns, rising mean

temperatures & rising

sea levels

Short/

Medium/

Long

Risk:

• Reduced availability of raw materials 

increased procurement costs

• Disruption to operations due to extreme

weather events

• Costs associated with repairs

• Weather conditions such as high

temperatures causing stock losses

• High temperatures  change in demand

• Working with our

suppliers to create

sourcing plans to

secure supply of

raw materials

• Flexibility of supply

chain

• Flood emergency and

contingency plans for

at-risk locations

Acute climate events

• e.g., heatwaves, drought,

floods, storms, crop pests

and animal diseases

Short/

Medium/

Long

Transition

risk

Policy and legal

• Increased pricing of

GHG emissions

• Regulation of existing

products and services

Short/

Medium

Risk:

• Increased operating costs

• Potential changes in consumer preferences

• Majority of cost

assumed to be passed

on to customers to

encourage purchase of

lower GHG emission

products

Market

• Changing consumer behavior

• Changing raw materials cost

• Changing operational

methods

Short/

Medium

Risk:

• Reduced revenue due to decreased demand

• Increased operating costs due to increasing

raw material costs

• Flexibility of

supply chain

Reputation

• Shifts in consumer

preferences

Short/

Medium

Opportunity:

• Increased revenue through demand for

low-carbon products and services

• Development of lower

GHG emission

products

Technology

• Substitution of existing

products, services, or assets

with lower emission options

• Transition to lower emissions

technology

Short/

Medium

Risk:

• Write off/early retirement of existing assets e.g.,

lorries, CHP boilers, ovens and refrigeration units

• Increased costs of adopting or deploying new

practices/technology

Opportunity:

• Reduced operating costs through efficiency gains

• Reduced exposure to fossil fuels and volatile prices

• Energy management

in line with engineering

asset management

Strategy

Sustainability is considered in the context

of our overall strategy-setting process. On

climate in particular, consideration is given

both in relation to how strategic choices on

‘where to play’ (what customers, categories

and channels we have exposure to) and ‘how

to play’ (how we manage our operations)

will impact on delivery of our climate

commitments. In the formulation of our

Group strategy, consideration is also given

to our sustainability strategy, and the

commitments and targets we have set as

part of that. More broadly, as the Group

strategy is executed, through deployment

of capital for either organic or inorganic

investment, a sustainability assessment

is carried out, including an assessment

on climate impact. To support this, we are

building in an internal price of carbon into

our capital request processes.

Greencore’s major sustainability ambitions of

Sourcing with Integrity, Making with Care

and Feeding with Pride address climate

change and mitigate the business’s exposure

to the different risks arising from climate

change. Our Scope 3 emissions from

products and our supply chain comprise the

majority of our total emissions footprint.

Given that we do not control our Scope 3

emissions, due to their indirect nature,

achieving Scope 3 reductions in our value

chain will require substantive coordination

and collaboration with suppliers, as well as

strategic communication with our

Key

Time period Years Reason

Short

0 to 5 years Aligned to our financial planning cycle

Medium

5 to 15 years Nearer term to capture transition risks and opportunities

Long

15 to 50 years Longer term to capture physical risks and opportunities

31Strategic Report | Directors’ Report | Financial Statements

customers. As such, our ability to influence

carbon reduction presents both a risk and an

opportunity to our decarbonisation strategy

and Net Zero commitment – the success of

our relationships both upstream and

downstream will prove critical.

The process of identifying climate-related

risks and opportunities was done via a

qualitative risk assessment process. This

was carried out to identify the climate-

related physical and transition risks and

opportunities that are material to Greencore.

These key significant risks were then built

into the scenario analysis process to fully

capture relevant areas of the business.

Quantitative scenario

analysis

To further build on these qualitative results,

we adopted a quantitative approach to

determine the potential financial impacts

associated with the identified material

climate risks for each exposed product

category. We have engaged with external

climate consultants to leverage their

expertise. Fundamentally, scenario analysis

will allow Greencore to test its current

strategies against a set of defined scenarios.

The outcomes of the analysis will inform the

climate change strategy of Greencore as well

as help in developing contingency plans in

response to possible future risks and

opportunities.

A materiality assessment was conducted,

based on a relative ranking of climate risks

and financial materiality to determine

the scope of analysis for FY22. Six food

categories were modelled for FY22 scenario

analysis (red meat, poultry, dairy, cereal,

vegetables and produce) and property.

This analysis was conducted to quantify

the financial impacts of both physical and

transition climate risks on Greencore in

2030, with an important focus on a low-

carbon transition. The objectives of this

analysis were primarily to allow Greencore to

understand the nature and scale of climate

risks’ impacts on its business model and to

identify risk hotspots. Two climate scenarios

were constructed to assess the impacts:

Risk type Ingredients Property

Physical risks

(RCP8.5)

• Changes in production volumes leading to an

increase in procurement cost

• Increased costs due to a carbon tax on

emissions in the agricultural sector

Transition risks

(RCP1.9)

• Floods – Property damage and loss in sales

• Increases in ambient temperatures – increase

in costs due to increased energy consumption for

refrigeration/cooling

• Heatwaves – loss of stock

• Increases in compliance costs due to a

carbon tax on Scope 1 and Scope 2

emissions

Climate scenarios:

Area of focus

Transition risk

RCP1.9 – 1.5°C

Physical risk

RCP8.5 – 4°C

Red meat

Very high Very low

Poultry

Very high Very low

Dairy

Very high Very low

Cereal

Very high Very low

Vegetables

Medium Very low

Produce

Low Very low

Property

Very high Very low

Assessment of impact:

Commentary:

* Financial impacts: determined via our existing business risk exposure profiles, Very high (>£5m); High (£3m to £5m), Medium (£1m to £3m), Low (£0.25m

to £1m); Very low (<£0.25m)

Modelling assumptions: An assumption that Greencore’s business activities (operating model, emissions etc.) in 2030 remained constant at FY21 levels and

Greencore does not innovate or mitigate the impacts of change of its sourcing strategy. An assumption that increases in costs are fully absorbed by Greencore

and not passed onto customers, to demonstrate the potential scale of risk to Greencore.

The assessment showed that the key risks for Greencore mainly arise from carbon pricing under the low-carbon transition scenario.

The impacts from chronic climate change and acute climate events on the ingredient categories studied were not found to be material

for Greencore in 2030. The physical risks to Greencore’s operated property are also relatively immaterial.

32 Greencore Group plc Annual Report and Financial Statements 2022

TCFD continued

Risk management:

The identification and management of

climate-change risks follow our established

risk-management process.

The Board is responsible for establishing and

maintaining the Group Risk Management

Policy. The Audit and Risk Committee,

under delegation from the Board, provides

structured and systematic oversight of

the Group’s risk management and internal

control systems. They review and monitor

the effectiveness of the Group’s risk

management and internal control systems

throughout the year.

The Risk Oversight Committee supports the

Audit and Risk Committee in the risk

management process, through additional

monitoring and evaluation of the risk

environment and the controls in place to

manage those risks. In addition, it gives

consideration to emerging risks which may

impact the Group in the future.

We have developed a sustainability risk

assessment model that enables us to see and

take action on hotspots in our supply chains.

Our sustainability risk assessment model

assesses all of our ingredients and ranks

them for potential issues including animal

welfare, carbon, deforestation, climate risk,

water scarcity and biodiversity, using external

databases. The outputs from the

sustainability risk assessment are utilised to

complete the sustainability risk register,

directly feeding into the Group risk

management process. The Group has

identified the overall impact of climate

change as a principal risk. The most

significant areas of risk relate to the potential

impacts on raw material availability through

changes in global weather patterns or

extreme weather events, meeting our carbon

reduction targets, consumer demand leading

to adjustment in product portfolio, and the

disruption of manufacturing and logistics

operations.

33Strategic Report | Directors’ Report | Financial Statements

Metrics and targets:

This section discloses our operational energy consumption, carbon footprint, and energy efficiency initiatives in line with the UK Government’s

Streamlined Energy and Carbon Reporting (‘SECR’) Regulation. A description of our performance against our targets and key performance

indicators is presented on pages 24 and 29. Our food waste baseline year of FY17 differs from our scope 1, 2 and 3 carbon emissions baseline

year of FY19 due to reporting in line with the food industry collaborative programme, the UK Food Waste Reduction Roadmap.

Annual GHG emissions (tonnes CO

e)*

Emissions from Absolute Group GHGs: FY22 FY21 Base FY19

Combustion of fuel and operation of facilities (Scope 1) 72,320 68,386 60,952

Electricity, heat, steam and cooling purchased for own use (Scope 2) 20,335 21,892 28,654

Total gross emissions (tCO

e) Scope 1 and 2 92,655 90,278 89,606

Green tariff (19,563) (21,042) (28,624)

Total net emissions (Scope 1 and 2) 73,092 69,236 60,982

Scope 3 emissions (m tonnes of CO

e) 1.48 1.33

1.61

GHGs Intensity Measure

Revenue 1,739,600 1,324,800 1,446,100

Scope 1 & 2 kilogrammesCO

e/£1 revenue 0.053 0.068 0.062

Scope 3 m tonnesCO

e/t product 2.71 2.71 2.75

* Greenhouse gas emissions data is taken from total Group operations for the UK and Ireland. Our UK-based GHG emissions account for >99% of the total gross emissions

(tCO

e). Our GHG emissions have been calculated using the GHG Protocol Corporate Accounting and Reporting Standard, and emissions factors from The Department for

Environment, Food and Rural Affairs’ (‘DEFRA’) UK Government GHG conversion factors for company reporting (where factors have not been provided directly by a supplier).

1 Adjusted historical data for Scope 3 emissions reflecting updates to data collection and ensuring consistency of approach.

Annual energy consumption*

Emissions from: FY22 FY21 Base FY19

Fuel non-renewable (MWh) 346,107 319,353 289,954

Fuel renewable (MWh) 1,498 1,960 1,045

Total fuel consumption (MWh) 347,605 321,313 290,999

Total electricity consumption (MWh) 105,087 103,053 108,012

Total energy consumption (MWh) 452,692 424,366 399,011

* Total energy consumption in kWh was calculated from primary consumption data, using standard conversion factors from the UK Government GHG Conversion Factors

for Company Reporting 2022. The data was collated specifically for the Annual Report. Energy consumption data is for UK and Ireland operations. FY19 and FY20 have

been adjusted to remove Premier Molasses and United Molasses which were sold in FY21.

Key Performance Indicators (for manufacturing only)

Emissions from: FY22 FY21 Base FY19

Total primary energy consumption (MWhp) 488,497 466,920 467,617

Energy intensity ratio (kWhp/tonne) 1,254 1,315 1,235

Water consumption (megalitres) 2,709 2,377 2,255

Water per tonne of production (m

/tonne) 6.96 6.70 5.96

* Our manufacturing KPIs are calculated from manufacturing sites only, excluding distribution and offices.

Food waste and surplus

Tonnes: FY22 FY21 Base FY17

Food waste 36,737 31,521 42,180

Animal feed 6,108 4,913 7, 285

Surplus redistribution 688 886 746

Total food handled 433,012 391,215 442,865

Food waste as a % total food handled* 8.48% 8.06% 9.52%

* Updated method of reporting to reflect new Waste and Resources Action Programme (‘WRAP’) guidance (2020) for reporting food waste, as a percentage of total food

handled (not just production), and complies with the international Food Loss & Waste Standard.

34 Greencore Group plc Annual Report and Financial Statements 2022

FY22

FY21

FY22

FY21

FY22

FY21

Financial

We use our Key Performance Indicators (‘KPIs’) to assess and monitor the

performance of the Group and to measure our progress against our strategic

objectives. Our financial KPIs measure progress of our strategic priorities in

delivering profitability, returns and cashflow. In measuring this progress,

we also consider the relationship between each of these measures.

All of the Group’s KPIs are non-IFRS measures or Alternative Performance

Measures (‘APMs’). The definitions, calculations and reconciliations of all APMs

(including these KPIs) to IFRS are set out within the APMs section on page 179.

Pro Forma Revenue Growth

+29.4%

(FY21: +6.2%)

Strategic relevance

The Group uses Pro Forma Revenue

Growth as it believes this provides a

more accurate guide to underlying

revenue performance. It is central to

our strategic pillar of Growth.

FY22 performance

Pro Forma Revenue Growth increased

by 29.4% in FY22 driven by underlying

volume growth, contribution from new

wins and increased pricing as we pass

through inflation.

Strategic relevance

The Group uses Adjusted Operating Profit

to measure the underlying and ongoing

operating performance of each part of the

business and of the Group as a whole.

FY22 performance

Adjusted Operating Profit in FY22 was

£72.2m, an increase of £33.2m against FY21.

This was primarily driven by the recovery

of demand post COVID-19.

Strategic relevance

The Group uses Adjusted EPS as a

key measure of the overall underlying

performance of the Group and returns

generated for each share.

FY22 performance

Adjusted EPS was 9.2 pence compared

to 3.7 pence in FY21, an increase of

5.5 pence (148.6%). This measure

improved in FY22 due to an increase

in Adjusted Operating Profit. The impact

of the share buyback was negligible

due to timing in the year.

Adjusted Operating Profit

£72.2m

(FY21: £39.0m)

Adjusted Earnings per Share (‘EPS’)

9.2p

(FY21: 3.7p)

Profitability

Our Key Performance Indicators

35Strategic Report | Directors’ Report | Financial Statements

FY22

FY21

FY22

FY21

FY22

FY21

Link to remuneration

The remuneration of Executive Directors is

aligned closely with financial and

non-financial KPIs through the Company’s

Performance Share Plan (‘PSP’) and Annual

Bonus Plan (‘ABP’). PSP awards granted in

FY22 (and those intended to be granted in

FY23) are based on a scorecard of three

equally-weighted measures comprising

ROIC and Adjusted EPS, alongside Total

Shareholder Return (‘TSR’). The financial

element of the ABP continues to be linked

to Adjusted Operating Profit (weighted

50%) and Free Cash Flow (weighted 25%),

with the remaining 25% linked to personal

and strategic objectives selected each year

to reflect our non-financial KPIs and other

short term business priorities.

See Report on Directors’ Remuneration on page 83

Strategic relevance

The Group uses Free Cash Flow to

measure the amount of underlying cash

generation and the cash available for

distribution and allocation.

FY22 performance

Free Cash Flow in FY22 was an inflow

of £58.7m compared to £72.2m in FY21.

The main driver of the decrease is a more

normalised working capital inflow in

FY22 post COVID-19.

Strategic relevance

The Group uses Free Cash Flow

Conversion to measure how efficiently

profits from the overall underlying

performance of the Group are

transformed to cash available for

distribution and allocation.

FY22 performance

The Free Cash Flow Conversion metric of

46.3% brings the Group back in line with

conversion levels of FY19 at 47.3%.

Strategic relevance

The Group uses ROIC as a key measure

to determine what return is generated

from each part of the business, as well

as measuring the financial quality

of potential new investments.

FY22 performance

The Group’s ROIC in FY22 was 8.4%

which was significantly higher than

the FY21 measure of 4.5%. ROIC was

positively impacted by the increase in

Adjusted Operating Profit, which was

offset by an increase in the effective

tax rate from 15% to 19%.

ROIC

8.4%

(FY21: 4.5%)

Free Cash Flow

£58.7m

(FY21: £72.2m)

Free Cash Flow conversion

46.3%

(FY21: 78.2%)

Returns Cash Flow

36 Greencore Group plc Annual Report and Financial Statements 2022

Non-financial

We use our KPIs to assess and monitor the performance of the Group and to measure our progress against our

strategic objectives. Our non-financial KPIs are designed to measure progress against the key drivers of our

purpose – People at the Core, Sustainability, Excellence and Great Food.

% Engagement in survey

76%

(FY21: 74%)

Waste as % total food

handled

8.5%

(FY21: 8.1%)

Strategic relevance

Our employee engagement

score provides us with insight

into how committed our

people are to our goals,

how motivated they are to

contribute to our success

and importantly how likely

they are to recommend

Greencore as an employer.

FY22 performance

Our overall engagement

score rose by two percentage

points in FY22 despite

significant changes in the

organisation and challenges

in our external environment.

We have continued to invest

in key areas that help to drive

engagement – further

enhancing communication

and training and development

across the business and

strengthening our focus

on inclusion.

Strategic relevance

Managing food waste is a top

priority across our operations.

We address this in multiple

ways including prevention,

redistribution, and use in

animal feed. This forms the

basis of our commitment to

halve our food waste (from a

FY17 baseline) by 2030, in line

with the UN SDG target.

FY22 performance

Our food waste was 8.5%

of total food handled. This is

an increase from last year’s

performance at 8.1%,

primarily due to the Scope

simplification of ranges

during the period of

COVID-19, which helped

to drive food waste as a %

of food handled down.

Strategic relevance

We aim to motivate and

support our people to take

on more responsibility

and ownership, we also

recognise and reward talent.

The Internal Progression Rate

is a useful measure to assess

this development and is

calculated as the total

number of roles vacant

in the year that were filled

by internal candidates.

FY22 performance

We are pleased to see

further growth in this metric.

Our Grow with Greencore

approach helps our people to

enrich their careers, providing

opportunities for growth and

progression, and to achieve

their potential.

Strategic relevance

Reducing GHG emissions

through intelligent energy

use will help us transition

towards a Net Zero future.

We have committed to

science based targets to help

guide us to succeed, and we

are continually monitoring

our use of energy to assess

our progress.

FY22 performance

In FY22, our total gross scope

1 and 2 carbon emissions

increased from the previous

year from 90,278 tonnes to

92,655 tonnes, an increase of

2.6%, and from our base year

of 89,606 tonnes an increase

of 3.4%. In contrast, as our

overall production levels

increased our manufacturing

energy intensity ratio (kWhp/

tonne) decreased from 1,315

kWhp/tonne to 1,254 kWhp/

tonne, an improvement of

4.6% in our efficiency.

% Internal Progression Rate

44%

(FY21: 40%)

Primary energy consumption

per tonne

1,254

(FY21: 1,315) kWp per tonne

Employee

engagement

Food waste

Learning and

development

Energy efficiency

People at the Core Sustainability

Our Key Performance Indicators continued

37Strategic Report | Directors’ Report | Financial Statements

Link to remuneration

The remuneration of Executive Directors

is aligned closely with financial and

non-financial KPIs through the

Company’s Performance Share Plan

(‘PSP’) and Annual Bonus Plan (‘ABP’). PSP

awards granted in FY22 (and those

intended to be granted in FY23) are based

on a scorecard of three equally-weighted

measures comprising ROIC and Adjusted

EPS, alongside Total Shareholder Return

(‘TSR’). The financial element of the ABP

continues to be linked to Adjusted

Operating Profit (weighted 50%) and Free

Cash Flow (weighted 25%), with the

remaining 25% linked to personal and

strategic objectives selected each year to

reflect our non-financial KPIs and other

short term business priorities.

See Report on Directors’ Remuneration on page 83

Strategic relevance

Producing safe, authentic

and excellent quality food is

central to everything we do.

The Group utilises the Brand

Reputation Compliance

Global Standards in food

safety (the ‘BRCGS’) to

measure food safety levels,

a standard that is recognised

by the Global Food Safety

Initiative. Testing is carried

out through audits on food

safety, quality and operational

criteria at each of our sites.

All unannounced audits were

paused during the pandemic.

These are now being

reinstated so the current

audit results are a mixture

of announced and

unannounced audits.

FY22 performance

For the fifth consecutive year,

we met the highest level of

food safety performance, with

all 23 of our manufacturing

units audited achieving AA or

A grades, the highest levels

attainable for announced

audits under BRCGS.

Strategic relevance

Central to our commercial

success is a relentless

focus on our customer

relationships. Each year, the

Advantage Group surveys

retailers about their chilled

convenience supplier base,

both branded and own-label,

across a range of important

performance areas.

FY22 performance

Despite a challenging

backdrop, we regained the

number-one position in the

overall Advantage Group

survey. We ranked as clear

number-one supplier within

the food to go and prepared

meals categories and scored

strong positions across our

other product areas.

Strategic relevance

Building customer

relationships underpins the

Group’s strategic priority to

deepen customer relevance.

An important component of

measuring this is our service

level. We track our service

level by measuring the

products we deliver to

customers, on time and in

full, compared to what they

ordered from us.

FY22 performance

Operational service levels in

the year fell back slightly from

98.1% to 97.4%, impacted by

the well-documented supply

chain and labour challenges

that have impacted the

broader UK food industry

in FY22.

Strategic relevance

We are committed to

enhancing the health,

safety and wellbeing of our

employees. We recognise this

is critical to the success of

our business, and we work

hard to understand risks to

our employees in order to

build strategic, targeted and

evidence-based interventions.

We continually review and

measure the performance of our

compliance and culture through

monitoring performance

measures and auditing that

informs Greencore leadership

on improvement programmes

for health and safety.

FY22 performance

Our RAFR has shown a slight

improvement from 0.37 to

0.33 as a result of a continued

focus on health and safety.

We also measure safety

performance through proactive

activities such as behavioural

safety observations and

engagement walks. In FY22,

we carried out almost 18,000

behavioural safety observations

and over 1,500 leadership

engagement walks.

% products delivered on

time and in full

97.4%

(FY21: 98.1%)

Reportable Accident

Frequency Rate (‘RAFR’)

0.33

(per 100,000 hours)

(FY21: 0.37)

% BRCGS audits at

AA/A grades

100%

(FY21: 100%)

Advantage Survey

(FY21:#3)

Food safety

Service

Health

and safety

Commercial

Excellence Great Food

38 Greencore Group plc Annual Report and Financial Statements 2022

Operating and financial review

Strategic developments

We made strong progress against our

strategic objectives in FY22, delivering good

year on year volume growth while recovering

significant levels of ongoing inflation and

enhancing profit conversion. This progress

was underpinned by close customer

engagement in what has been, and

continues to be, a very challenging trading

environment for the food industry. Overall

demand in the Group’s categories has been

very resilient, with demand supported by

robust service levels across the network,

despite having to navigate ongoing and

challenging inbound supply chain disruption.

Onboarding of previously announced new

business wins continued during the quarter,

expanding the Group’s product ranges

and channel reach. New business wins

accounted for approximately 4.4% of the

Group’s Pro Forma Revenue Growth in FY22.

The Group also continued to work closely

with customers on product and range

innovations to mitigate the impact of

inflation at consumer level.

Our strategic capital investment programme

of approximately £30m across three existing

manufacturing sites, to support the delivery

of previously announced business wins,

was completed in Q4. There are some

commissioning challenges as we ramp

up production in our new ready meals

production unit. We are focused on

managing this disruption and driving

operating efficiency and improved output

and conversion rates.

Better Greencore, our change programme,

continues to progress well. The first phase of

the programme is expected to deliver an

annual recurring benefit of approximately

£30m in FY24. To unlock these improvements

the Group will invest a total of approximately

£24m comprising operating and capital

costs during FY22 and FY23 of which £16.1m

has been incurred in 2022. The internal

operational and organisation model has

changed fundamentally in this first phase,

realigning teams from a matrixed structure to

a functional model. While this is a complex

task, it will deliver a more customer-centric

approach across the business. The new

structure is supported by the full deployment

of an integrated business management

model that will make the Group more

effective across product development,

operations and overall cost management.

The second phase of Better Greencore is

focused on operational and technological

excellence. This phase will be launched

internally in FY23.

Trading performance

Reported Group revenue increased by 31.3%

to £1,739.6m in FY22. Revenue Growth

in FY22 was driven by a combination of

increased volumes, double digit percentage

increase in underlying pricing and increased

revenue in the Group’s Irish ingredients

trading business as well as the impact of

a 53rd trading week in FY22.

Adjusted Operating Profit rose from £39.0m

to £72.2m and Adjusted Operating Margin

advanced by 130bps to 4.2%. Group Profit

Before Tax was £39.8m in FY22, compared

to a Profit Before Tax of £27.8m in FY21.

The UK trading environment, especially in

food to go categories, was resilient during

FY22 notwithstanding some demand

volatility caused by COVID-19 related

mobility restrictions in H1 22 and the

increasing impact of inflation on the UK

consumer during H2 22. The Group will

continue to monitor the impact of increased

prices at a consumer level closely.

In FY22 the Group benefitted from its strong

market position in the grocery retail channel,

its expanded customer and format mix, and

its portfolio across food to go and other

convenience categories. The new business

wins onboarded in FY21 and FY22 also

contributed meaningfully to Group revenue

performance. In H1 22, the Group worked

closely with one of its key food to go

customers to extend its offering into the

store network of a leading UK coffee shop

retailer. The Group also completed the

onboarding of a significant business win

in ready meals in H2 22, supported by

a strategic capital investment.

FY22 revenue in the Group’s food to go

categories (comprising sandwiches, salads,

sushi and chilled snacking) totalled £1,161.3m

and accounted for approximately 67%

of reported revenue. Reported revenue

increased by 37.9% in these categories,

driven by a recovery in underlying demand

as the year progressed, strong execution on

new business wins, and increased pricing.

Revenue for the distribution of third-party

products accounted for approximately 10%

of Group revenue in FY22 (FY21: c.8%).

On a pro forma basis, revenue in food to go

categories grew by 35.2% in FY22 driven by

increased volumes due to the impact of new

business wins in 2021 and 2022 as well as

ongoing recovery in underlying volume

towards pre COVID-19 levels, and double

digit inflation recovery.

The Group’s other convenience categories

comprise activities in the chilled ready meals,

chilled soups and sauces, chilled quiche,

ambient sauces and pickles, and frozen

Yorkshire Pudding categories, as well as an

Irish ingredients trading business. Reported

revenue across these categories increased

by 19.8% to £578.3m in FY22.

On a pro forma basis, revenue increased by

19.2%, driven by increased underlying pricing,

and higher revenue in the Group’s Irish

ingredients trading business. Volumes were

modestly up year on year due to the Group’s

onboarding of new business wins in the ready

meals category.

There was a substantial increase in inflation in

the Group’s main cost components in FY22,

which led to a double digit rate of inflation for

the period. This inflation was fully recovered

through pricing and other mechanisms

comprising product and range innovations,

alternative sourcing and operating efficiency

initiatives. The largest component of inflation

was raw materials and packaging, where we

have explicit price recovery mechanisms in

review

Operating

FY22

£m

FY21

£m

Change

(As reported)

Change

(Pro Forma

basis)

Revenue 1,739.6 1,324.8 31.3% 29.4%

Group Operating Profit 52.1 42.8 21.7%

Adjusted Operating Profit 72.2 39.0 £33.2m

Adjusted Operating Margin % 4.2% 2.9% 130bps

39Strategic Report | Directors’ Report | Financial Statements

place with a number of our customers.

The other elements were recovered through

a combination of constructive direct

dialogue with our customers and operational

efficiencies. We also work collaboratively

with our customers on multiple other

initiatives to manage inflation, including

range alterations, packaging redesigns

and product reformulations.

In FY22, the Group experienced an IT

security incident that resulted in temporary

unauthorised access to part of the Group’s IT

systems. The Group responded rapidly and

proactively to the incident to protect the

Group’s infrastructure and data and to

restore the impacted part of the IT systems.

From an operational perspective, the impact

on customers was minimised as the Group

put in place manual back up processes

to ensure that production could continue.

The Group recognised net costs of £1.9m

incurred as a result of the incident. This

included insurance recovery of £8.6m

against the business impact and costs

relating to the incident. Appropriate

notification was also made to the relevant

authorities. In FY21 the Group incurred

£5.3m of operating costs relating to

COVID-19.

Overall, Group Operating Profit in FY22

increased to £52.1m (FY21: £42.8m). Adjusted

Operating Profit increased to £72.2m (FY21:

£39.0m). The increase in Adjusted Operating

Profit was driven by a return to profitability in

the Group’s food to go categories as profit

conversion improved on an increased revenue

base. Underlying profitability in the Group’s

other convenience categories was below,

FY21 levels as we incurred pre operating and

commissioning costs for the new ready meals

production unit.

Group Cash Flow and Returns

In FY22, we continued to manage cashflows

and leverage closely, balancing recovering

profitability, seasonal working capital outflows

and capital investment requirements to

support future growth in the business.

Free Cash Flow was an inflow of £58.7m in

FY22, a reduction of £13.5m on FY21 which

was £72.2m. The decrease primarily reflects

more normalised working capital inflow

in 2022 post COVID 19. Free Cash Flow

Conversion was 46.3% compared with 78.2%

in FY21.

Net Debt at 30 September 2022 was

£228.0m, a decrease of £14.7m compared to

24 September 2021. Net Debt excluding lease

liabilities decreased to £180.0m from £183.1m

in FY21. Net Debt: EBITDA leverage, as

measured under financing agreements, was

1.5x at period end which represents further

progress on deleveraging and has now

reached our target range of 1.0x – 1.5x, which

was rebased from 1.5x to 2.0x post COVID-19.

In November 2021, the Group further

strengthened its balance sheet when it

extended the maturity on its £340.0m

revolving credit facility by one year to January

2026. As at 30 September 2022, the Group

had total committed debt facilities of

£578.0m and a weighted average maturity of

2.5 years. At 30 September 2022, the Group

had cash and undrawn committed bank

facilities of £398.0m.

Cash interest costs in FY22 were £16.7m

down from £18.8m in FY21. As rates are

increasing, we anticipate cash interest to

increase to approximately £18m in FY23.

In May 2022, we announced a £50m value

return to shareholders over the coming

two years and subsequent to the year-end,

announced that the first phase, a £10m share

buyback programme that commenced on

26 July 2022, had been completed. We plan

to buyback a further £15m of shares in FY23.

ROIC increased to 8.4% in FY22, compared to

4.5% in FY21. The year on year increase was

driven primarily by increased profitability in

the year. Average invested capital decreased

modestly year on year from £728.8m to

£695.0m.

Better Future Plan

Greencore’s sustainability strategy, the

‘Better Future Plan’, was launched in

November 2021 and is built around three

pillars and aspirations:

• Sourcing with Integrity: By 2030 we

will source our priority ingredients from

a sustainable and fair supply chain

• Making with Care: By 2040 we will

operate (Scope 1 and 2) with net zero

emissions

• Feeding with Pride: By 2030 we will have

increased our positive impact on society

through our products

The Group advanced the Better Future Plan

during FY22, with a focus on progressing the

data and systems framework to measure

performance effectively. The Group is

building a substantial body of data on the

nutritional profile of its portfolio and is

currently trialling product foot-printing

technology with one of its customers. While

this progress has not yet followed through to

absolute reductions in the Group’s scope 1

and scope 2 carbon footprint as increased

production post COVID-19 has impacted the

Group’s energy usage, the Group continues

to look at ways to accelerate delivery through

focusing on collaboration with customers to

drive the systems level change required.

The Group’s total carbon footprint is made up

of emissions from direct operations (Scope 1

and 2), which represents 6% of the Group’s

total, while the Group’s indirect emissions

(Scope 3) from the ingredients sourced and

the products placed on the market by the

Group represent the majority (94%) of the

Group’s total footprint. The most major

reductions will therefore come from

collaborating with the Group’s customers

and suppliers to reduce Scope 3, but we

recognise the importance of Scope 1 and 2

and are continuing to look to accelerate plans

on energy reduction.

The Group has published its TCFD report

conducting scenario analysis as part of the

FY22 Annual Report to estimate the potential

impact of climate risks and opportunities.

Food donation continues to be a central focus

for the Group’s community engagement

efforts with the equivalent of 1.63m meals

redistributed to food redistribution

organisations in order to ensure our surplus

food reaches those who need it.

The Group’s standalone sustainability report

for FY22 on our Better Future Plan will be

released in January 2023.

FY22

£m

FY21

£m

Change (as

reported)

Free Cash Flow 58.7 72.2 (£13.5m)

Net Debt 228.0 242.7 £14.7m

Net Debt (excluding lease liabilities) 180.0 183.1 £3.1m

40 Greencore Group plc Annual Report and Financial Statements 2022

Operating and financial review continued

Revenue and Operating Profit

Reported revenue in the period was

£1,739.6m, an increase of 31.3% compared

to FY21, primarily reflecting the recovery in

demand in food to go categories and the

impact of new business wins. Pro Forma

Revenue increased by 29.4%.

Group Operating Profit increased from

£42.8m to £52.1m as a result of an improved

revenue delivery in FY22 and notwithstanding

the movement from a net exceptional gain

to a net exceptional charge in FY22. Adjusted

Operating Profit of £72.2m compared to

£39.0m in FY21, driven by an improvement

in profit in food to go categories partly offset

by a lower underlying performance in the

Group’s other convenience categories as we

commissioned the new ready meals facility.

Adjusted Operating Margin was 4.2%,

130 basis points higher than FY21.

Net finance costs

The Group’s net bank interest payable was

£11.1m in FY22, a decrease of £3.9m versus

FY21. The decrease was driven by lower

cost of debt during FY22. The Group also

recognised a £1.2m interest charge relating

to the interest payable on lease liabilities in

the period (FY21: £1.3m).

The Group’s non-cash finance charge in

FY22 was a net £nil (FY21: £2.7m charge).

The change in the fair value of derivatives

and related debt adjustments including

foreign exchange in the period was a

£1.1m credit (FY21: £0.9m charge) and the

non-cash pension financing charge of £1.1m

was £0.6m lower than the FY21 charge

of £1.7m.

Profit before taxation

The Group’s Profit before taxation increased

from £27.8m in FY21 to £39.8m in FY22,

driven by higher Group Operating Profit and

lower finance costs. Adjusted Profit Before

Tax in the period was £59.8m compared

to £22.6m in FY21, primarily driven by an

improvement in Adjusted Operating Profit.

Taxation

The Group’s effective tax rate in FY22

(adjusting pre-exceptional profit for the

change in fair value of derivatives) was

19% (FY21: 15%). In March 2021, the UK

Government announced an increase in the

UK rate of corporation tax from 19% to 25%,

to be effective from 1 April 2023. This has

been reconfirmed by Jeremy Hunt, the

newly appointed Chancellor of the

Exchequer, in October 2022.

Exceptional items

The Group had a pre-tax exceptional charge

of £16.5m in FY22, and an after-tax charge of

£13.0m, comprised as follows:

Exceptional Items £m

Reorganisation costs (16.1)

Pension restructuring (0.4)

Exceptional items (before tax) (16.5)

Tax on exceptional items 3.0

Exceptional items (after tax) (13.5)

In H1 22 we commenced a Better Greencore

programme to support the revitalisation of

its Excellence cost efficiency programmes

and to unlock further cost efficiencies by

reducing organisational complexity. The

Group recognised a charge of £16.1m in

respect of work carried out in the period.

Earnings per share

The Group’s basic earnings per share for

FY22 was 6.2 pence compared to 5.0 pence

in FY21. This was driven by a £6.9m increase

in profit attributable to equity holders,

partially offset by an increase in the weighted

average number of shares in issue in FY22

to 523.4m (FY21: 511.8m).

Adjusted Earnings were £48.1m in the period,

£29.3m ahead of prior year levels largely due

to an increase in Adjusted Operating Profit.

Adjusted earnings per share of 9.2 pence

compared to adjusted earnings per share

of 3.7 pence in FY21.

Cash Flow and Net Debt

Adjusted EBITDA was £34.6m higher in

FY22 at £126.9m. The Group incurred a net

working capital inflow of £2.0m. Maintenance

capital expenditure of £16.9m was incurred

in the period (FY21: £16.2m). The cash

outflow in respect of exceptional charges

was £13.6m (FY21: £3.3m).

Interest paid in the period was £16.7m (FY21:

£18.8m), including interest of £1.2m on lease

liabilities, a decrease on FY21 reflecting lower

average borrowings and interest costs as the

group exited the covenant waiver period and

reduced leverage. The Group recognised a

cash tax credit of £2.2m reflecting a refund

received in the period. The cash tax rate for

the Group is expected to rise towards the

Group’s effective rate in the medium term

as a result of increased profitability and a

reduction in the degree to which UK losses

may be utilised in any one year. Cash

repayments on lease liabilities increased

to £17.3m (FY21: £14.3m). The Group’s cash

funding for defined benefit pension schemes

was £11.5m (FY21: £7.0m), reflecting the

restoration of cash contributions after an

agreement with Trustees to defer cash

contributions for a period in FY21.

These movements resulted in a free cash

inflow of £58.7m compared to an inflow

of £72.2m in FY21 when a working capital

benefit was realised as volume returned

to the business post COVID-19.

In FY22, the Group incurred strategic capital

expenditure of £33.1m (FY21: £24.0m).

The Group did not make any equity dividend

cash payments in either period. The Group

made net share purchases of £11.8m in FY22

reflecting the initiation of a £10m share

buyback program (which completed on

6 October 2022) and the implementation of

a new employee share ownership scheme

introduced in the period. This compared to

net equity proceeds of £87.1m in FY21 when

the Group completed an equity placing.

review

Financial

41Strategic Report | Directors’ Report | Financial Statements

In December 2020 (FY21), the Group also

completed the sale of its interests in its

molasses trading businesses for a final cash

consideration of £16.3m.

The Group’s Net Debt excluding lease

liabilities at 30 September 2022 was

£180.0m, a decrease of £3.1m compared

to the end of FY21.

Financing

In November 2021 the Group further

strengthened its balance sheet when it

extended the maturity on its £340.0m

revolving credit facility by one year to

January 2026. As at 30 September 2022, the

Group had total committed debt facilities of

£578.0m and a weighted average maturity

of 2.5 years. These facilities comprised:

• A £340.0m revolving credit bank facility

with a maturity date of January 2026

• A £75.0m revolving credit bank facility

with a maturity date of March 2023

• A £50.0m bilateral bank facility with

a maturity date of January 2024

• A £45.0m bank term loan facility with

a maturity date of June 2024

• £18.0m and $55.9m of outstanding

Private Placement Notes with maturities

ranging between June 2023 and

June 2026

At 30 September 2022 the Group had cash

and undrawn committed bank facilities

of £398.0m.

Pensions

All of the Group’s legacy defined benefit

pension schemes are closed to future

accrual. The net pension deficit relating to

legacy defined pension schemes, before

related deferred tax, at 30 September 2022

was £20.3m, £25.7m lower than the position

at 24 September 2021. The net pension

deficit after related deferred tax was £10.4m

(FY21: £29.3m), comprising a net deficit on

UK schemes of £44.5m (FY21: £65.3m) and

a net surplus on Irish schemes of £34.1m

(FY21: £36.0m).

The decrease in the Group’s net pension

deficit was driven principally by an actuarial

gain on UK scheme liabilities arising from an

increase in the discount rates used to value

these liabilities. The movement in the

discount rate is driven by the corporate bond

rate. The UK scheme is 77% hedged for

movements in gilt yields. Whilst there has

been significant economic volatility

particularly in bond markets recently the

liquidity position of the scheme has been

more than sufficient to management

collateral calls and to maintain the hedged

position of the scheme.

The Irish scheme is fully hedged for

movements in gilt yields and subsequent

to the year end the Trustees of the scheme

entered into an annuity buy-in transaction in

respect of pensioner liabilities, representing

approximately 80% of the liabilities in

the scheme.

Separate to this IAS 19 Employee Benefits

valuation, the valuations and funding

obligations of the Group’s legacy defined

benefit pension schemes are assessed on

a triennial basis with the relevant Trustees.

During H2 21 the Group concluded the latest

assessment of the valuation and funding plan

for its principal UK legacy defined benefit

pension scheme. The Group expects the

annual cash funding requirement for all

schemes to be modestly below £15m.

Return of value to shareholders

In May 2022, we announced that we would

return £50m of value to shareholders over

the next two years. The first phase of this

value return was a £10m share buyback

program which commenced in July 2022

and completed in early October 2022.

We plan to return a further £15m of value

to shareholders in 2023 in the form of

a share buyback.

Emma Hynes

Chief Financial Officer

28 November 2022

42 Greencore Group plc Annual Report and Financial Statements 2022

Risks and risk management

risk

How we manage

The Group’s operating, financial and governance

activities are supported by effective risk management

processes. The Group understands the criticality of

identifying, assessing and prioritising risks in order to

help manage and mitigate the probability and impact

of these risks materialising.

Our approach to risk management

The Board is responsible for effective risk

management which is fundamental to the

ability of the Group to deliver on its strategic

objectives. The Board understands the need

for a robust system of internal control and a

risk management framework in accordance

with the 2018 UK Corporate Governance

Code (the ‘Code’). There is a clear link

between effective risk management, and

the Company’s ability to continue as a viable

entity. This is set out in further detail on

page 44.

The Board has established a culture of

effective risk management across the Group

by identifying and monitoring principal and

emerging risks, setting risk appetite and

determining the risk tolerance of the Group.

The Board is responsible for establishing and

maintaining the risk management framework

and ensuring that the Group has appropriate

processes and controls in place to manage

risk within the Group, which includes

compliance with relevant laws and

regulations.

The Audit and Risk Committee, under

delegation from the Board, reviews the

Group’s risk management framework on a

regular basis. The Audit and Risk Committee

is responsible for assessing the design,

operation and monitoring by management

of the Group’s internal control systems. It is

also responsible for overseeing the

effectiveness of the Group’s internal control

environment. The activities of the Audit and

Risk Committee for FY22 can be found in the

Report of the Audit and Risk Committee set

out on pages 76 to 82.

The Group has a well-established internal

audit and risk management function, (the

‘IAR’). The IAR department is responsible for

providing objective and independent

assurance that the Group’s risk management,

governance and internal control processes

remain appropriate and operate effectively.

Risk management focus in FY22

The Group’s risk management framework

sets out how risks are identified and

managed to support the Group in achieving

its strategic ambitions by providing a clear,

concise and comprehensive approach to

governance, implementation and

embedding of risk management practices.

The risk management framework is reviewed

and approved annually by the Audit and Risk

Committee. As part of this review during

FY22, the Audit and Risk Committee

continued to receive reports from the Risk

Oversight Committee (the ‘ROC’), which

performs additional monitoring and

reviewing of risks across the Group.

The ROC monitors and evaluates the risk

environment and reviews and challenges the

controls in place to manage key risks, as well

as reviewing and considering emerging risks

which may impact the Group in the future.

The core membership of the ROC, which is

chaired by the Chief Financial Officer, who

also acts as the Group Executive Team

sponsor for risk management, is made up of

senior risk assurance and business leaders

including the Group Company Secretary, the

Chief Commercial Officer, the Director of

Internal Audit and Risk, the Director of

Health, Safety and Environment, the

Technical Director, and the Group IT

Director. The ROC provides regular updates

to the Audit and Risk Committee as part of

the risk management framework.

This year, the Group has identified the need

to enhance the risk management process

and framework in order to increase the

maturity of the process as well as to enhance

risk culture. Therefore a project led by the

Director of Internal Audit and Risk has

commenced to refresh the overall risk

management approach during FY23.

Identifying and monitoring

principal and emerging risks:

Principal and emerging risks are identified

through a well-established Group-wide risk

assessment process. This encompasses the

identification, management, ownership and

monitoring of risks in each significant area

of the Group’s operation. This approach

involves the review of individual risk registers

for each function, assessing each appropriate

risk in terms of the likelihood of its

occurrence, the potential impact on the

Group and a quantification of the mitigating

controls in place or needed to help manage

that risk. This process ensures risk

management controls are appropriately

owned and embedded within the various

operational and functional activities of

the Group.

A full top-down review is then undertaken

by the Group Executive Team as well as the

ROC. The Group Executive Team and the

ROC evaluate the principal risks identified

through the bottom-up approach as well as

emerging risks with reference to the Group’s

strategy and the operating environment.

The Audit and Risk Committee monitors

the overall process and reviews the output

including the consolidated Group risk

controls, as well as any emerging risks.

In addition, the Audit and Risk Committee

receives updates on the risk assurance

process with specific deep dives on certain

key risk areas.

The FY22 overall risk assessment process

identified a number of risks that have

increased since the prior year and as a result

have an impact on the overall risk profile of

the Group. These include risks associated

with changes in consumer demand, the

growing impact of environmental and climate

changes. The impact of the war in Ukraine

and the increased cost of living are

heightening the risks associated with the

supply and availability of raw materials

as well as the volatility of our cost base.

43Strategic Report | Directors’ Report | Financial Statements

Risk management framework

Board of Directors

The Board has overall responsibility to ensure appropriate risk management and internal control systems are designed to identify,

manage and mitigate risks which may impact the achievement of the Group’s objectives. The Board also ensure an appropriate

risk appetite has been set and consider how the Group’s longer term viability may be impacted by the crystallisation of one or

more of these risks.

Audit and Risk Committee

The Audit and Risk Committee has responsibility delegated by

the Board to provide structured and systematic oversight of

the Group’s risk management and internal control systems.

The committee review and monitor the effectiveness of

the Group’s risk management and internal control systems

throughout the year. The Chair reports to the Board on its

activities regarding audit and risk management matters.

Functions/departments

Functions/Departments manage and monitor their own key risks through regular review, ensuring their risk registers and

risk mitigations are accurate.

First line of defence

Operational Management are

responsible for risk identification,

managing the internal control

environment and monitoring

changes in the Group’s risk profile.

Second line of defence

Group functional teams ensure first

line is operating as designed,

manage performance reviews,

internal control verifications, and

facilitate risk assessments. This

includes Food, Health and Safety,

Information Security, Legal and

Financial compliance functions.

Third line of defence

The Group Internal Audit function

gives independent assurance over

the operation of the internal control

framework, risk management

systems and governance processes.

Risk Oversight Committee (‘ROC’)

The ROC supports the Audit and Risk Committee in the risk

management process through additional monitoring and

evaluation of the risk environment and the controls in place

to manage those risks. In addition it gives consideration to

emerging risks which may impact the Group in the future.

The ROC is comprised of senior leadership, and is chaired

by the CFO, and provides updates to the Audit and Risk

Committee on its activities, as well as challenge and

counsel to management.

44 Greencore Group plc Annual Report and Financial Statements 2022

CommercialStrategic

People

Operational

Risks and risk management continued

The risks for the Group and their year-on-year movement

are depicted in the heat map below.

Risk heat map:

impact of the persistently high inflation

across the industry on consumer prices.

The Group has substantially recovered

the inflation experienced over the last

12months, and is making decisions whether

to bid for or renew contracts based on

their economics, including the ability to

recover inflation.

IT security incident

In December 2021, the Group experienced

an IT security incident that resulted in

temporary unauthorised access to part of our

IT systems. The Group’s immediate priority

was to respond quickly to the incident to

protect the Group’s infrastructure and data

and to minimise the impact on operations

and customers. Our IT security team worked

in conjunction with external security experts

to assist with our response and investigation

work. We prioritised containment of the IT

security incident, which included a zero risk

approach to take the impacted part of our

network offline, and to rebuild those systems

from trusted uncompromised sources.

Appropriate notification was also made to

relevant authorities.

The impact of these events has been

reflected in the Group’s principal risks

(as set out on pages 46 to 49)

Going concern and the viability

statement:

In accordance with the relevant provisions

set out in the Code, the Board has taken

account of the principal risks and

uncertainties, as set out in the table on pages

46 to 49 in considering the statements to be

made in regard to the going concern basis

of accounting and the viability statement.

These statements are set out below.

Going Concern

The Directors, after making enquiries, have a

reasonable expectation that the Group has

adequate resources to continue operating as

a going concern for the foreseeable future.

In the current period, the UK trading

environment, especially in food to go

categories, was resilient notwithstanding

some demand volatility caused by COVID-19

related mobility restrictions in H1 22 and the

increasing impact of inflation on the UK

consumer during H2 22. Despite the

inflationary challenges impacting the

broader UK food industry at present, there

has been limited demand impact to date in

the Group’s categories. The Group also

continues to monitor the potential impact of

a recessionary environment and cost of living

factors on consumer spending through the

year end.

Emerging risks:

As part of our overall risk assessment process

and in line with the Code, the Group

captures and monitors areas of uncertainty

which, while not having a significant impact

on the business currently, have the potential

to adversely impact the Group in the future;

these are considered to be emerging risks.

Following the FY22 risk assessment no new

emerging risks were identified

The monitoring of existing and identification

of new emerging risks are an ongoing focus

for the Group.

Key events that have impacted the

Group’s principal risk profile:

Cost of living and inflation

We are currently in a period of high inflation,

which is putting pressure on the Group as well

as the industry in general relating to food

prices and volatility of costs. Alongside energy

price increases, there is a lot of media focus

on the cost-of-living crisis, which is impacting

consumer spending habits.

The Group remains focused on the recovery

of inflation through all mechanisms available

and are working with our customers and

supply partners to mitigate the ongoing

No. Risk group Risk Movement

Strategic Reduction in demand for products

Strategic Environment & climate change

Commercial Price and volatility of our cost base

Commercial Availability of raw materials

Commercial Reliance on key customers

Operational Availability of IT systems

Operational Inefficiency of legacy IT systems

Operational Breach of regulatory requirements

Operational Contamination of our products

People Inability to attract and retain talent

People Impact of COVID 19 and future pandemics

People Health & Safety failures

Low Medium High Changed risk profile

Key

45Strategic Report | Directors’ Report | Financial Statements

Accordingly, the Directors have considered a

number of scenarios for the next 18 months

from the year end date. These scenarios

consider the potential impact of a

recessionary environment including the

impact of inflation and interest rates on

consumer spending, along with

consideration of under recovery of inflation,

supply chain disruption issues and further

one-off future events linked to a reduction in

consumer footfall during the winter months.

The Group is satisfied that there is sufficient

headroom in the financial covenants under

current facilities under each scenario.

The Group’s scenarios assume:

• A base case projection using internally

approved forecast and strategic plans,

which reflect the external economic

environment. These plans incorporate

the potential impact of climate change on

the Group’s capital investment process;

• A downside scenario which assesses the

potential impact of a recessionary

environment including the impact of

inflation and interest rates on consumer

spending, along with consideration of

under recovery of inflation and further

one-off future events linked to a

reduction in consumer footfall during the

winter months; and

• A severe downside scenario which

assesses the further impact of inflation

under recovery, along with a further

reduction in sales to reflect the impact of

changes in consumer spending through

any recessionary period.

While the Group is in a net current liability

position of £128.7m (2021: £135.9m) at the

30 September 2022, the Group retained

financial strength and flexibility as at the end

of FY22. The Group had cash and undrawn

committed bank facilities of £398.0m at

30 September 2022 (September 2021:

£433.6m).

Based on these scenarios and the resources

available to the Group, the Directors believe

the Group has sufficient liquidity to manage

through a range of different cashflow

scenarios for the next 18 months from the

year end date. Accordingly, the Directors

adopt the going concern basis in preparing

these Group Financial Statements.

Viability statement disclosure

In line with the Code Provision 31, the

Directors have carried out a rigorous review

of the prospects of the current business and

its ability to meet its liabilities as they fall due

over the medium term. In undertaking this

review, the Directors concluded that a

three-year timeframe continues to be an

appropriate period for this assessment given

that this is the key period of focus within the

Group’s strategic planning process and is

a typical period for visibility of commercial

arrangements with the Group’s customers.

The objectives of the annual strategic

planning process are to consider the key

strategic choices facing the Group and to

build a consolidated financial model with

various scenarios taking into account the

principal risks facing the Group which may

threaten the Group’s solvency, liquidity,

cash flow and business model.

Assumptions are built for the income

statement with a flow through to the balance

sheet and cash flow. These are rigorously

tested by management and by the Directors.

Sensitivity analysis is applied to reflect the

potential impact of some of the principal

strategic and commercial risks of the Group

as described on pages 46 to 47. These risks

could affect the level of sales, profitability

and cash generation of the Group and the

amount of capital required to deliver them.

Amodel of financing requirements is also

built for the same time period taking into

account the base plan and sensitivities

against this, together with the likelihood of

being able to refinance maturing committed

facilities. Based on the results of this analysis,

the Directors have a reasonable expectation

that the Group will be able to continue

in operation and meet its liabilities as

they fall due over the three year period

of their assessment.

Risk appetite:

Risk appetite promotes consistent, ‘risk-

informed’ decision-making aligned with

strategic aims, and it also supports robust

corporate governance by setting clear

risk-taking boundaries. The risk appetite

statement provides guidance on the nature

and extent of risk the Group is prepared to

take. For example:

• As a consumer foods business, the Board

has a low risk-appetite for operational

risks which may impact the Group’s

reputation or brand in areas such as, the

health and safety of our key stakeholders

including employees, food product-

quality, cyber security and sustainability;

• There is also a low risk appetite for

exposure to financial and compliance

risks. The Board seeks to achieve financial

stability and certainty particularly during

a time of volatility in interest rates and the

cost of living, as well as comply with all

industry-specific and wider regulatory

requirements;

• Whilst the Board seeks to minimise

commercial risk, for example by ensuring

relevance and differentiation of our

products; it accepts that a moderate

risk appetite is acceptable as the Group

operates in a highly competitive,

fast-moving and consumer led industry

that is impacted by external events,

particularly economic and political

challenges;

• The Board recognises that, in pursuit of

strategic growth objectives, there is often

a trade-off between risk and reward in

making investment decisions, such as

acquisitions, capital investments or new

category expansions. In these instances,

ahigher level of risk may be accepted in

order to maximise the return for its

shareholders. This also applies to business

change and transformation, where the

Board accepts a higher risk in ensuring

the Group continues to transform and

restructure to improve efficiency and

effectiveness, as demonstrated by the

Better Greencore programme.

For each of the principal risks, the Group’s

risk appetite has been considered when

determining the nature and extent of the key

control mechanisms in place and the level of

assurance required. The Board and the Audit

and Risk Committee receive regular reports

from key functions such as sustainability,

health and safety, compliance, finance, legal,

IT, internal audit and HR. Where the level of

assurance obtained is not considered to

adequately reflect the stated risk appetite,

then increased assurance activity is

introduced.

Through the risk management framework,

all material strategy and investment decisions

are approved by the Board. These are

supported by detailed diligence information,

documentation, and analysis, along with

input from management and subject matter

experts (‘SMEs’) to ensure that the risks

associated with each decision, and the

related execution plan, are fully understood

and accepted.

46 Greencore Group plc Annual Report and Financial Statements 2022

Risks and risk management continued

Principal risks

Risk area Description Control Movement

Strategic

1. Reduction

in demand for

our products

The Group operates in highly competitive

markets with significant product

innovation, technical advances and/or

the intensification of price competition by

competitors, both direct manufacturing

competitors or competitors of our

customers. The recent inflationary and

cost-of-living challenges impacting

discretionary income pose the risk that

consumers shift towards less convenient

and lower cost alternatives offered by

our competitors.

In addition, as consumer priorities change,

(e.g. placing more importance on health,

ethical issues and sustainability) and

lifestyle (e.g. the shift towards working

from home), failure to keep pace could

result in reduced demand which would

adversely affect the Group’s results.

To mitigate this challenge the Group invests

in research and development and continuous

improvement to ensure that the introduction

of both new products and improved production

processes place the Group at the forefront of

consumer needs in its chosen markets.

The Group also continuously works to streamline

its cost base to ensure it remains competitive.

due to the cost of

living crisis

2. Impact of

environmental

responsibilities

and climate

change

There is a risk that the Group may fail to

uphold its environmental responsibilities

and commitments, or appropriately

manage the impact of climate change.

Failure to appropriately manage the

impact of climate change in our products

and operations, to meet the expectation

of customers and consumers will impact

the reputation of the Group. Failing to

adhere to the increasing sustainability

regulatory requirements may also result in

breaches of laws or regulations and may

have a financial and/or legal impact for

the Group.

The Group has established a strong governance

model which includes a Sustainability Steering

Committee responsible for the delivery of our

sustainability strategy. Reporting to this Committee

are six Sustainable Business Management Groups

(‘SBMGs’) that provide a cross-functional forum to

develop and steer our strategy at an operational level.

The SBMGs cover responsible sourcing and human

rights, ethics, energy and environment, packaging,

communities, and healthy and sustainable diets. These

steering groups are chaired by senior leaders. More

detailed information on our climate transition strategy

is contained within the TCFD section of this report on

pages 29 to 33.

due to the increasing

regulations and

stakeholder

expectations

Commercial

3. Increasing

prices and

volatility of

our cost base

The Group’s cost base and margin can be

affected by fluctuating raw material and

energy prices and changes in cost and

price profile. During the year we have seen

this evidenced as a result of the conflict in

Ukraine, the extreme weather conditions

during the heatwave over the summer

months and the ongoing supply chain

challenges post Brexit. The additional

challenges with labour availability have

also driven inflation in labour costs.

The Group maintains a strong commercial focus

on procurement, process and cost improvement to

manage and mitigate the impact of cost increases and

volatility. In addition, the Group adopts strategies that

diversify risk thereby improving the positioning of its

businesses and the defensibility of its margins. The

Group now has a number of cost transparency models

with its customers which also seek to mitigate the

impact of input cost fluctuations.

due to the cost of

living crisis

Risk trend

Risk increased Risk unchanged Risk decreased

47Strategic Report | Directors’ Report | Financial Statements

Risk area Description Control Movement

4. Availability of

raw materials

The Group’s ability to manufacture its

product is dependent on the ability to

source required raw materials. Although

we operate several strategies to mitigate

this risk, this can be a challenge when

external events (such as extreme weather

and geo-political conflicts) impact the

supply chain. The Group may also be

impacted by the loss of a key supplier.

Aloss of, or interruption of supply from

a key supplier could cause short term

disruption to the operational ability of the

Group and adversely affect its results.

The Group’s procurement function uses various

strategies to minimise this risk, including dual-

sourcing, strategic suppliers, and some vertical

supply chains.

due to the cost of

living crisis

5. Reliance

on our key

customers

The Group benefits from close

commercial relationships with a number

of key customers. The loss of any of these

key customers, either due to tightening

of commercial terms, or reputational

damage that may compromise the

relationship, could result in a material

impact on the Group’s results. The Group

is also at risk of poor performance by

customers in the categories it supplies.

There is a further risk that our key

customers may seek to dilute their own

risk by moving to a multi-supplier base.

The Group invests significant resources to maintain

deep, multi-level relationships which drive value and

minimise risk for both itself and its key customers.

The Group also continues to focus on developing

its business across a broad range of customers across

all formats.

Operational

6. Disruption to

the availability

of IT Systems

In common with most large organisations,

the Group carries a risk related to cyber

events threatening the availability and/or

integrity of our systems and data. An

increase in cyber threat activity continues

to be seen globally and such events can

have a significant impact on the Group,

as experienced by the IT security incident

at Greencore earlier this year.

At the time of our IT security incident this year, the IT

team were working through a roadmap of security

improvement. Following that incident, this roadmap

has been accelerated, improving our controls.

Activities include deploying a 24/7 Security Operations

Centre, with protection and monitoring across all

IT endpoints, and improved user access controls.

In addition, the Group has cyber insurance that

mitigates the risk of financial loss resulting from

a deliberate attack.

7. Inefficiencies

in legacy IT

Systems

The Group relies heavily on information

technology meaning that continuous

investment in systems is required to

support our business. A lack of integration,

flexibility and modernisation within our IT

systems could have an impact on

efficiencies and therefore our cost base.

Our IT department ensures that all applications are

fully supported and this allows our systems and

infrastructure to successfully deliver our operational

requirements. Nevertheless we have identified an

opportunity to update and better align the IT

infrastructure across the Group. This will be addressed

as part of the Better Greencore programme.

48 Greencore Group plc Annual Report and Financial Statements 2022

Risks and risk management continued

Principal risks

Risk area Description Control Movement

8. Breach of

regulatory

(including

industry

specific)

requirements

As a producer of convenience foods

and ingredients, the Group is subject

to rigorous and constantly evolving

regulations and legislation particularly

in the areas of food safety and

environmental protection. Failure to

comply with such regulations may lead

to serious financial and/or reputational

impact. In the post-Brexit environment we

are continuing to manage the increased

range of legislation covering food and

packaging standards, our manufacturing

process and the movement of goods to

and from the EU. In addition, we are also

managing many new regulations covering

the broader sustainability agenda which

requires significant management focus.

The Group maintains strong technical and

sustainability functions, which set high standards for

food safety and environmental controls, striving for

best practice above and beyond the minimum

compliance requirements.

In addition, the Group Company Secretariat and

Legal Department maintain a ‘key legislation register’

covering all corporate (UK and Ireland) and operational

key legislation both current and pending, which is

verified on an annual basis. This includes key legislation

changes as a result of Brexit, and otherwise as

they arise.

The register also records mechanisms as to how we

ensure compliance with key legislation throughout the

Group.

due to the increasing

regulations

requirements

Contamination

of our product

within the

Manufacturing

Process

The Group produces a large volume of

food annually and there are risks of

product contamination through either

accidental or deliberate means. This may

lead to products being withdrawn or

recalled, as well as being a significant draw

on resources and could therefore result

in both a financial and/or reputational

impact on the Group.

The Group maintains industry-leading food safety and

traceability processes and procedures. Each site has

a team dedicated to ensuring compliance with Group

and industry standards in this area and the Group

constantly monitors performance against a detailed

set of metrics and measures. Each manufacturing site

is subject to a significant number of audits by internal

teams, customers and independent bodies auditing

against recognised global food safety standards.

The Group also operates stringent controls across

its supply chain including audits and strict approval

of its suppliers, supported by rigorous ethical and

quality checking of all ingredients.

Risk trend

Risk increased Risk unchanged Risk decreased

49Strategic Report | Directors’ Report | Financial Statements

Risk area Description Control Movement

People

10. Inability

to attract and

retain talent

The ongoing success of the Group is

dependent on attracting and retaining

a high quality workforce that can

successfully deliver our manufacturing

operations, as well as management who

can effectively implement the Group’s

strategy. Due to political, economic and

legislative uncertainty and change, there

is a heightened risk that labour cost and

availability may impact our ability to

attract and retain employees at all levels.

The Group is continually reviewing and improving its

recruitment processes to reflect changing market

conditions, including rigorous compliance checks to

attract the workforce required within our sites. The

Group also has a strong commitment to excellent

working conditions, on-the-job training and specific

programmes to enhance communication and

colleague engagement in order to retain employees.

There is robust succession planning and strong

recruitment processes, offering competitive and

attractive remuneration and benefits packages to

attract and retain management. The Board reviews

succession planning at a senior leadership level

and we conduct an annual survey to monitor

colleague engagement.

Finally, we have internal key performance indicators

around attraction, retention and attrition to monitor

and control progress across all levels.

due to the labour

shortage challenges

and increasing salary

costs to attract and

retain talent

11. Impact

of COVID-19

and future

pandemics

As we revert to more normal ways of

working, after the heightened impact of

the COVID-19 pandemic, we are acutely

aware of how a new COVID-19 variant or

even a completely new pandemic could

again severely impact our competitiveness

and financial results if we are unsuccessful

in adapting our business and operations.

The safety and wellbeing of our colleagues has been,

and continues to be, our overriding priority, and

therefore should there be a future wave of COVID-19

or new pandemic, the Group would be able to rely on

mitigation strategies that were developed as a result

of COVID-19 and remain in place. These include

pandemic-safe practices and processes at our sites

including additional security, hygiene and social

distancing measures. We have also developed practices

for office colleagues working from home, to help them

adapt to new ways of working.

Our Group Executive Team monitors events closely

with regular Board oversight, evaluating the impact

and designing appropriate response strategies.

This includes securing additional supply chain

capacity to meet changes in demand.

12. Health and

safety failures

on our sites

Ensuring the health and safety of our

colleagues is of paramount importance at

Greencore. There is a risk of an accident

or incident occurring on our sites, causing

illness or injury to employees. In addition

to the human impact of such an event,

it can also result in reputational damage

and/or financial liabilities through legal

action by the affected parties.

The Group has strong health and safety processes and

procedures in place supported by an established review

programme across all sites. As a result of the COVID-19

pandemic, the Group has experienced a period of

unprecedented change. The health and safety

processes and procedures were enhanced at sites

through the engagement, supervision and safety

checks required ‘to keep people safe’ reinforcing

the safety message and culture of putting people

at the core.

50 Greencore Group plc Annual Report and Financial Statements 2022

Group Executive Team

Leading

Dalton Philips

Chief Executive Officer

Dalton’s roles, prior to joining

Greencore on 26 September 2022,

include chief executive of daa plc,

the global airports and travel retail

group, chief executive of Wm

Morrison plc, then a FTSE 100

company and the UK’s fourth largest

supermarket chain, chief executive

of luxury goods retailer Brown

Thomas Group, and chief operating

officer of Canadian retailer Loblaw

Companies Limited. Dalton also

served as a Senior Advisor to the

Boston Consulting Group.

He started his career with Jardine

Matheson followed by Walmart.

Emma Hynes

Chief Financial Officer

Appointed as Chief Financial Officer with

effect from 19 May 2020.

Emma joined Greencore as Chief

Financial Officer Designate in April 2020

and stepped into the Chief Financial

Officer position in May 2020 having

previously served as chief financial

officer of Press Up Hospitality Group.

Emma is a highly experienced finance

leader with an in depth knowledge of

the food industry, having previously

served in a variety of finance leadership

roles in Greencore over 11 years,

including as Group Finance Director

with responsibility for all areas of

finance. She has extensive experience

in corporate activity in the UK and

internationally.

Emma is a fellow of the Institute of

Chartered Accountants, having started

her career with Deloitte.

Kevin Moore

Deputy Chief Executive Officer

Kevin was appointed Deputy

Chief Executive Officer in November

2021. Prior to his current appointment,

Kevin served as Chief Commercial

Officer with responsibility for

commercial, marketing and insight,

end-to-end value chain optimisation,

new product development, purchasing,

coordination across our business

and Greencore’s Direct to Store and

distribution operations. Kevin has also

served as Managing Director of

Greencore’s Food to Go and Prepared

Meals divisions.

Before joining Greencore as

Commercial Director in 1998, Kevin

worked in senior roles in management

consultancy and retail.

Andy Parton

Chief Commercial Officer

Andy is Chief Commercial Officer,

responsible for setting and delivering

the commercial strategy and

agenda. The role covers marketing,

insights and category management,

product development and

management, sales and

procurement.

Prior to this Andy was Business

Director for our Food to Go

business. Andy joined Greencore

in 2014 having previously held

senior commercial positions in Aldi

and PepsiCo.

by example to

drive excellence

51Strategic Report | Directors’ Report | Financial Statements

Guy Dullage

Chief People Officer

Guy is Chief People Officer and is

responsible for human resources

across the Group. Prior to this, Guy

served as HR Director for the

Prepared Meals division.

Guy joined Greencore in 2015.

Previously, he held a variety of senior

HR roles in the UK and Europe, with

the majority of his experience over

this time within the manufacturing

sector. Guy has also held a number

of directorships, board and pension

trustee roles during his career.

Guy became a Fellow of the CIPD

in 2014.

Lee Finney

Chief Operating Officer

Lee joined Greencore in October 2022

as Chief Operating Officer. He is the

executive accountable for technology,

sustainability, and the end-to-end

supply chain.

He has extensive experience in

transforming the operational

performance of global businesses,

having held Vice President, Chief

Transformation Officer and Chief Supply

Officer roles in the UK, Europe, North

America and Australasia.

Lee has an MBA, was awarded the

Advanced Management Program,

and has completed executive

programmes at MIT and Stanford, USA.

Damien Moynagh

General Counsel and

Company Secretary

Damien joined Greencore in

November 2022 as General Counsel

and Company Secretary and will be

responsible for leading Greencore’s

Legal and Company Secretariat

functions.

He has over 20 years’ experience as

a corporate lawyer and senior

executive across Europe, the United

States and Asia. In his most recent

role as General Counsel and

Company Secretary of a FTSE250

company, he was responsible for

the group’s legal and corporate

secretarial functions and also

its risk, sustainability, quality and

compliance functions.

He has also completed executive

education programmes most

recently at Cambridge University

and Columbia University.

Nigel Smith

Chief Transformation Officer

Nigel is Chief Transformation Officer,

and has been leading the work on

our Better Greencore transformation

programme since the beginning of

this year.

He joined Greencore in 2017, and has

held a variety of roles supporting the

strategic development of the Group,

most recently as Chief Strategy Officer.

Prior to joining Greencore, Nigel worked

as a strategy consultant with McKinsey &

Company, and in multiple public policy

positions within European Union

institutions.

Nigel is a an alum of Trinity College

Dublin, Sciences-Po in Paris and the

College d’Europe in Bruges. He most

recently completed an executive

education diploma in Business Finance

from University College Dublin.

52 Greencore Group plc Annual Report and Financial Statements 2022

Chair’s introduction to corporate governance

“Throughout FY22, the Board remained

committed to maintaining the highest

standards of corporate governance,

recognising that this is key to promoting

long-term sustainable success.”

Compliance with the Code

The Directors present their report and

Financial Statements for year ended

30 September 2022. The Directors’ Report

is contained on pages 52 to 116.

The 2018 UK Corporate Governance Code

(the ‘Code’), which is available on the

Financial Reporting Council’s website,

www.frc.org.uk, continues to be the standard

against which we measured ourselves in

FY22. This letter explains how the Group has

applied the principles as set out in the Code.

Except as outlined below, the Board believes

that the Group complied with the provisions

of the Code for the financial year ended

30 September 2022.

Although Greencore is not listed on Euronext

Dublin, the Group also voluntarily adopts the

provisions of the Irish Corporate Governance

Annex (the ‘Annex’). The full text of the Annex

is available on Euronext Dublin’s website,

www.euronext.com.

Deviation from the Code

Last year, we identified two areas of non-

compliance with provisions of the Code,

which also apply to FY22, namely alignment

of Executive Director pension contributions to

the workforce (Provision 38) and chair tenure

not exceeding nine years from the date of first

appointment to the Board (Provision 19).

In FY20, the then Chief Executive Officer

(‘CEO’) Patrick Coveney voluntarily agreed to

reduce his contractual pension entitlement

by 5% annually over a four year period.

Consistent with this, from April 2021 until his

departure from the business on 30 March

2022, Patrick Coveney’s pension contribution

reduced to 25%. The pension contribution

rate for CEO and Executive Director Dalton

Philips who was appointed on 26 September

2022 is 8% of salary, which is in line with the

pension contributions available to the wider

colleague base.

Whilst I was first appointed as Board Chair

in January 2013, I joined the Board in

November 2008. The key considerations on

the continuation of my tenure as Board Chair

until no later than the 2023 Annual General

Meeting (‘AGM’) were disclosed in the FY21

Annual Report and followed consultation

with shareholders who expressed their

support. On 15 September 2022, the Board

announced that following a comprehensive

Board Chair search and selection process,

it had appointed Leslie Van de Walle as

Non-Executive Director and Chair Designate

and Leslie will join the Board on 1 December

2022. Leslie will succeed me as Board Chair

at the conclusion of the AGM in January

2023 at which point I will retire as Non-

Executive Board Chair and from the Board.

During the year, following the resignation

of Patrick Coveney as CEO and Executive

Director on 30 March 2022 and whilst the

search for a new CEO was underway, I was

appointed Executive Chair on 31 March 2022.

This gave rise to a temporary deviation from

two provisions of the Code, being: the

requirement for all members of the

Remuneration Committee to be independent

Non-Executive Directors (Provision 32);

and the requirement that the role of chief

executive and chair should not be exercised

by the same person (Provision 9). Further

details in connection with these deviations

from the Code, both of which were remedied

during FY22 are set out on pages 73 to 74.

Corporate governance in FY22

Throughout FY22, the Board remained

committed to maintaining the highest

standards of corporate governance and

ensuring our processes are aligned with best

practice. The Board recognises that this is key

to promoting long-term sustainable success.

The Board continued to focus on succession

planning, in particular Board Chair and CEO

succession, engagement with our colleagues

and other stakeholders, monitoring progress

against our sustainability goals, and

strengthening our inclusion and diversity

initiatives.

The Board continued with visits to Group

sites, allowing first hand experience of the

current workplace culture.

Priorities for FY23

Our overarching objective remains

unchanged. It is to continue to deliver value

and to create a positive and sustainable

impact for all our stakeholders. The Board

remains confident that the Group is well

placed to create value for all stakeholder

groups going into FY23.

Amongst some of the key priorities for the

Board in FY23 is a continued focus on

ensuring that the incentive arrangements for

Executive Directors are aligned with our

remuneration principles and shareholders’

expectations; the Board is grateful for the

input and insights received from

shareholders and the open dialogue it has

been able to have during FY22. The Board

appreciates that our remuneration incentives

must be fair in order to motivate and retain

our colleagues and we will continue to

monitor our progress on this. Board

succession planning and refreshment will

also remain an area of focus for FY23.

We remain committed to our focus on

engagement with our colleagues and other

stakeholders. We do this through site visits, a

range of colleague communication activities,

our annual People at the Core colleague

survey, colleague forums, our inclusion and

diversity initiatives, and monitoring progress

against our sustainability goals to ensure

our shareholders’ interests are taken into

consideration when making decisions –

all consistent with our purpose to make

every day taste better.

I would like to thank my Board colleagues past

and present for their ongoing commitment

and support during my time at Greencore.

Gary Kennedy

Board Chair

28 November 2022

53Strategic Report | Directors’ Report | Financial Statements

60%40%

80%

20%

10%

70%

Board diversity as at 30 September 2022

Number of scheduled

Board meetings in FY22

Number of new Directors

in FY22

Board meeting attendance in

FY22

98%

Independence of the Board

excluding the Chair as at the

end of FY22

78%

Read our Report of the Nomination and Governance Committee (pages 72 to 75)

Compliance with the UK

Corporate Governance Code

The Company applied the principles of the 2018 UK

Corporate Governance Code (the ‘Code’) for the

financial year ended 30 September 2022.

Available from www.frc.org.uk

Except as outlined on page 52, the Board believes that

the Group complied with the provisions of the Code

for the financial year ended 30 September 2022.

Whilst Greencore is not listed on Euronext Dublin,

for increased transparency we have also chosen to

voluntarily adopt the provisions of the Irish Corporate

Governance Annex (the ‘Annex’).

Available from www.euronext.com.

Further information on these governance matters

can be found as follows:

Board leadership and

company purpose

See more on page 56

Audit, risk and internal control

See more on page 76

Division of responsibilities

See more on page 68

Remuneration

See more on page 83

Composition, succession

and evaluation

See more on page 70

Board members and scheduled meeting attendance

during FY22

Board

John Amaechi 8/8

Sly Bailey 8/8

Patrick Coveney

3/4

Paul Drechsler 8/8

Gordon Hardie

5/5

Linda Hickey 8/8

Emma Hynes 8/8

Gary Kennedy 8/8

Anne O’Leary 8/8

Dalton Philips

0/0

Helen Rose 8/8

Helen Weir 8/8

1. The Board and each Committee held additional meetings throughout the year.

Further details on additional Committee meetings are set out in the respective

Committee reports.

2. Patrick Coveney resigned as CEO and Executive Director on 30 March 2022.

3. Gordon Hardie stepped down as a Non-Executive Director on 3 May 2022.

4. Dalton Philips was appointed as CEO and Executive Director on 26 September 2022.

Executive Non-Executive <1 year 1-5 years 5-10 years >10 years

By gender By role By tenure

Female Male

54 Greencore Group plc Annual Report and Financial Statements 2022

Board of Directors

Gary Kennedy

BA, FCA

Dalton Philips

BA, MBA

Emma Hynes

MBA, FCA

John Amaechi

OBE,BSc

Sly Bailey Paul Drechsler

CBE, BA, BAI

Linda Hickey

BBS

Anne O’Leary

CDir

Helen Rose

BSc, FCA

Helen Weir

CBE, MA, MBA, FCMA

Damien

Moynagh

Non-Executive

Director

Board Chair

(Aged 64)

Chief Executive

Officer

(Aged 54)

Chief Financial

Officer

(Aged 47)

Non-Executive

Director

(Aged 52)

Non-Executive

Director

Senior Independent

Director

(Aged 60)

Non-Executive

Director

(Aged 66)

Non-Executive

Director

(Aged 60)

Non-Executive

Director

(Aged 55)

Non-Executive

Director

(Aged 57)

Non-Executive

Director

(Aged 60)

General Counsel and

Group Company

Secretary

(Aged 45)

Appointed as Non-

Executive Director with

effect from 20 November

2008, Board Chair with

effect from 29 January

2013 and Executive Chair

from 31 March 2022 to

25 September 2022.

Appointed as Chief

Executive Officer with

effect from 26 September

2022.

Appointed as Chief

Financial Officer with

effect from 19 May 2020.

Appointed as Non-

Executive Director with

effect from 1 February

2021.

Appointed as Non-

Executive Director with

effect from 17 May 2013

and Senior Independent

Director with effect from

14 December 2017.

Appointed as Non-

Executive Director with

effect from 1 May 2020.

Appointed as Non-

Executive Director with

effect from 1 February

2021.

Appointed as Non-

Executive Director with

effect from 1 February

2021.

Appointed as Non-

Executive Director with

effect from 11 April 2018.

Appointed as Non-

Executive Director with

effect from 1 February

2020.

Appointed as Group

Company Secretary with

effect from 7 November

2022.

Relevant skills and experience

Gary is a highly skilled

business leader with a

wealth of executive and

non-executive experience

spanning a variety of

sectors. Gary currently

serves as board chair of

Goodbody Stockbrokers

and Norcros plc. He

previously served as board

chair of Connect Group

plc and Green REIT plc and

also served on the board

of Elan plc, Allied Irish Bank

plc, Friends First Holdings

Ltd and IDA Ireland. Gary

was a Government-

appointed director of

IBRC.

As Board Chair, Gary is

committed to effective

governance and fosters

high quality debate by

coordinating the diverse

knowledge, experience

and perspectives on the

Board. He understands

and promotes constructive

engagement with

shareholders and spends

time building relationships

both with fellow Board

members and colleagues

throughout the business.

Gary is a fellow of the

Institute of Chartered

Accountants and a council

member of the Institute of

Directors. He is a director

of Focus Ireland, a

founding chair of the 30%

Club Ireland and served as

co-chair of Balance for

Better Business, showing

his commitment to

diversity and inclusion.

Dalton’s roles, prior to

joining Greencore on

26 September 2022,

include chief executive of

daa plc, the global airports

and travel retail group,

chief cxecutive of Wm

Morrison plc, then a FTSE

100 company and the UK’s

fourth largest supermarket

chain, chief executive of

luxury goods retailer

Brown Thomas Group,

and chief operating officer

of Canadian retailer

Loblaw Companies

Limited. Dalton also served

as a senior advisor to the

Boston Consulting Group.

He started his career

with Jardine Matheson

followed by Walmart.

Dalton currently serves as

a non-executive director

of Wilko Hardware Stores

Limited and IBEC CLG.

Dalton has a BA from

University College Dublin,

and a MBA from Harvard

Business School.

Emma joined Greencore

as Chief Financial Officer

Designate in April 2020

and stepped into the Chief

Financial Officer position in

May 2020 having

previously served as chief

financial officer of Pressup

Hospitality Group. Emma

is a highly experienced

finance leader with an in

depth knowledge of the

food industry having

previously served in

a variety of finance

leadership roles in

Greencore over eleven

years, including as Group

Finance Director with

responsibility for all areas

of finance. She has

extensive experience in

corporate activity in the

UK and internationally.

Emma is a fellow of the

Institute of Chartered

Accountants, having

started her career with

Deloitte.

John is a respected

organisational

psychologist, executive

coach and is the founder

and chief executive officer

of APS Intelligence Ltd, a

talent and leadership

development firm. He has

a diverse range of industry

experience, currently

serving on the Lloyd’s of

London culture advisory

group, the KPMG UK LLP

inclusive leadership board

and Sanofi’s diversity,

equity and inclusion board.

In addition, John is a

leadership training partner

with the National Health

Service (‘NHS’) and a

non-executive director

of Manchester University

NHS Trust. John also

previously served on the

Inclusive Advisory Panel

at Tesco.

John is a Chartered

Scientist, a Chartered

Fellow of the Chartered

Institute of Personnel and

Development and a Fellow

of the Royal Society for

Public Health. He is a

research fellow at the

University of East London

and his research interests

are effective, inclusive

leadership, building

high-performing teams

and organisational design

that maximises

productivity and human

thriving in readiness for the

future world of work.

Sly has extensive business

leadership experience

having been chief

executive officer for almost

ten years of one of the UK’s

largest media companies,

Trinity Mirror plc. She also

previously served as chief

executive officer of IPC

Media.

Sly has held a number of

listed and private board

roles, including serving as a

non-executive director of

Ladbrokes plc and EMI plc,

where she was also senior

independent director and

chair of the remuneration

committee. She has also

served as a non-executive

director and chair of the

remuneration committee

for the Press Association.

Sly currently serves as a

non-executive director of

IPSX Group Limited where

she is also chair of the

remuneration committee

and a member of the

nomination committee.

Sly’s broad knowledge

spanning a variety of

sectors enables her to

understand different

perspectives and business

circumstances

underpinning her

appointment as Senior

Independent Director. Sly’s

strong interest in employee

related matters has been

invaluable in her role as

Workforce Engagement

Director and Chair of the

Nomination and

Governance Committee.

Paul has considerable

executive and non-

executive director

experience in a variety of

UK and international

companies across a range

of industries.

Paul was previously chair

of Bibby Line Group and

a senior non-executive

director of Essentra Plc,

where he was chair of the

remuneration committee

and a member of the audit

and nominations

committees. Prior to this,

he spent nine years as

chairman and chief

executive officer of the

Wates Group. Paul

recently retired as

chancellor of Teesside

University and previously

served as president of the

Confederation of British

Industry and was chair of

Teach First, a UK

education charity.

Paul is currently a

non-executive director of

Cazenove Capital. He also

serves as chair of both the

International Chamber of

Commerce (UK) and

BusinessLDN. In July

2022, Paul was appointed

president of the Society of

Chemical Industry. He is

also a member of the

global advisory board of

Trinity College Dublin.

Linda brings a wealth of

experience and

knowledge in capital

markets and corporate

governance having spent

her executive career in

stockbroking and

investment banking. Linda

previously worked at NCB

Stockbrokers and Merrill

Lynch, and more recently

served as head of

corporate broking at

Goodbody Stockbrokers.

Linda is a non-executive

director of Kingspan

Group plc, a global leader

in insulation and building

envelope solutions, where

she serves as senior

independent director,

worker relations director,

chair of the remuneration

committee and is a

member of the

nominations committee.

Linda is also a non-

executive director of Cairn

Homes plc where she is

remuneration committee

chair and a member of the

audit and risk committee.

She is also vice chair of

Quanta Capital’s advisory

board and previously

served as chair of the Irish

Blood Transfusion Service.

Anne brings significant

experience spanning a

variety of sectors including

digital integrations, data

analytics, cultural change

programmes, and strategic

acquisitions and

partnerships. Anne

currently serves as vice

president of Meta’s

mid-market business

division for the EMEA

region. Prior to joining

Meta, Anne served as chief

executive officer of

Vodafone Ireland for nine

years, prior to which she

was managing director of

BT Ireland.

Anne previously served as

a non-executive director

of Vodacom Group Ltd,

South Africa’s leading

connectivity and financial

services company. She

also served as chair of

Goal Global, an

international humanitarian

response agency, from

2015 to 2021 and also as

president of the Dublin

Chamber of Commerce

from 2018 to 2019. Anne is

also a current board

member of IBEC CLG, a

business and employer

association for

organisations based in

Ireland and Ludgate, an

Irish non profit enterprise

facilitating job growth via

digital technology and

remote working hubs.

Helen brings substantial

operational, financial, risk

and UK retail experience

gained from senior finance

roles at Dixons, Forte,

Safeway and Lloyds

Banking Group.

Helen has significant

transformation experience

gained from her roles as

retail integration director at

Lloyds Banking Group and

as chief operating officer at

TSB Banking Group plc.

Helen has a probing focus

on cyber security, risk

matters, and internal

controls. In addition, she

understands the

importance of building a

diverse talent pipeline and

brings strong insight in this

area to the Board. Helen

also recognises the

fundamental importance

of embedding

sustainability into the

Group. As Sustainability

Engagement Director,

Helen acts as a strong

source of guidance and

support to both the Board

and colleagues on the

Group’s sustainability

agenda.

Helen is a fellow of the

Institute of Chartered

Accountants in England

and Wales, having trained

with Coopers & Lybrand.

Helen is a qualified

accountant and a highly

experienced finance

professional with extensive

board experience having

served as chief financial

officer of a number of

companies including Marks

& Spencer plc, John Lewis

Partnership, Lloyds Banking

Group and Kingfisher plc.

Helen is a member of the

supervisory board of the

retail company Ahold

Delhaize, where she chairs

the governance and

nomination committee and

is a member of the audit,

finance and risk committee.

She is also a non-executive

director of Superdry plc,

where she serves as senior

independent director, chair

of the nomination

committee and as a

member of the audit and

remuneration committees.

Helen is a non-executive

director of Compass Group

(the parent company of Bata

Shoes), where she also

chairs the audit committee.

Helen was appointed chair

designate of National

Express Group PLC with

effect from 1 October 2022.

Helen was previously

non-executive director

and chair of the audit

committees of Just Eat plc,

GEMS Education and Royal

Mail Holdings as well as

non-executive director of

SABMiller plc and Cineworld

plc.

Damien joined Greencore

in November 2022 and

leads our Legal and

Company Secretariat

functions. He has over 20

years’ experience as a

corporate lawyer and

senior executive across

Europe, the United States

and Asia. In his most

recent role as general

counsel and company

secretary of FTSE 250

listed UDG Healthcare plc,

Damien was responsible

for the group’s legal and

corporate secretarial

functions and also its risk,

sustainability, quality and

compliance functions.

Prior to this, Damien was

chief operating officer and

general counsel at Sysnet

Global Solutions, a

fast-growing global

technology business.

Damien trained and

practiced as a corporate/

merger and acquisitions

lawyer with Freshfields

Bruckhaus Deringer in

their London, Toyko and

New York offices and

subsequently with Maples

and Calder in their Dublin

office. He has also

completed executive

education programmes

most recently at

Cambridge University and

Columbia University.

Committee membership

55Strategic Report | Directors’ Report | Financial Statements

Gary Kennedy

BA, FCA

Dalton Philips

BA, MBA

Emma Hynes

MBA, FCA

John Amaechi

OBE,BSc

Sly Bailey Paul Drechsler

CBE, BA, BAI

Linda Hickey

BBS

Anne O’Leary

CDir

Helen Rose

BSc, FCA

Helen Weir

CBE, MA, MBA, FCMA

Damien

Moynagh

Non-Executive

Director

Board Chair

(Aged 64)

Chief Executive

Officer

(Aged 54)

Chief Financial

Officer

(Aged 47)

Non-Executive

Director

(Aged 52)

Non-Executive

Director

Senior Independent

Director

(Aged 60)

Non-Executive

Director

(Aged 66)

Non-Executive

Director

(Aged 60)

Non-Executive

Director

(Aged 55)

Non-Executive

Director

(Aged 57)

Non-Executive

Director

(Aged 60)

General Counsel and

Group Company

Secretary

(Aged 45)

Appointed as Non-

Executive Director with

effect from 20 November

2008, Board Chair with

effect from 29 January

2013 and Executive Chair

from 31 March 2022 to

25 September 2022.

Appointed as Chief

Executive Officer with

effect from 26 September

2022.

Appointed as Chief

Financial Officer with

effect from 19 May 2020.

Appointed as Non-

Executive Director with

effect from 1 February

2021.

Appointed as Non-

Executive Director with

effect from 17 May 2013

and Senior Independent

Director with effect from

14 December 2017.

Appointed as Non-

Executive Director with

effect from 1 May 2020.

Appointed as Non-

Executive Director with

effect from 1 February

2021.

Appointed as Non-

Executive Director with

effect from 1 February

2021.

Appointed as Non-

Executive Director with

effect from 11 April 2018.

Appointed as Non-

Executive Director with

effect from 1 February

2020.

Appointed as Group

Company Secretary with

effect from 7 November

2022.

Relevant skills and experience

Gary is a highly skilled

business leader with a

wealth of executive and

non-executive experience

spanning a variety of

sectors. Gary currently

serves as board chair of

Goodbody Stockbrokers

and Norcros plc. He

previously served as board

chair of Connect Group

plc and Green REIT plc and

also served on the board

of Elan plc, Allied Irish Bank

plc, Friends First Holdings

Ltd and IDA Ireland. Gary

was a Government-

appointed director of

IBRC.

As Board Chair, Gary is

committed to effective

governance and fosters

high quality debate by

coordinating the diverse

knowledge, experience

and perspectives on the

Board. He understands

and promotes constructive

engagement with

shareholders and spends

time building relationships

both with fellow Board

members and colleagues

throughout the business.

Gary is a fellow of the

Institute of Chartered

Accountants and a council

member of the Institute of

Directors. He is a director

of Focus Ireland, a

founding chair of the 30%

Club Ireland and served as

co-chair of Balance for

Better Business, showing

his commitment to

diversity and inclusion.

Dalton’s roles, prior to

joining Greencore on

26 September 2022,

include chief executive of

daa plc, the global airports

and travel retail group,

chief cxecutive of Wm

Morrison plc, then a FTSE

100 company and the UK’s

fourth largest supermarket

chain, chief executive of

luxury goods retailer

Brown Thomas Group,

and chief operating officer

of Canadian retailer

Loblaw Companies

Limited. Dalton also served

as a senior advisor to the

Boston Consulting Group.

He started his career

with Jardine Matheson

followed by Walmart.

Dalton currently serves as

a non-executive director

of Wilko Hardware Stores

Limited and IBEC CLG.

Dalton has a BA from

University College Dublin,

and a MBA from Harvard

Business School.

Emma joined Greencore

as Chief Financial Officer

Designate in April 2020

and stepped into the Chief

Financial Officer position in

May 2020 having

previously served as chief

financial officer of Pressup

Hospitality Group. Emma

is a highly experienced

finance leader with an in

depth knowledge of the

food industry having

previously served in

a variety of finance

leadership roles in

Greencore over eleven

years, including as Group

Finance Director with

responsibility for all areas

of finance. She has

extensive experience in

corporate activity in the

UK and internationally.

Emma is a fellow of the

Institute of Chartered

Accountants, having

started her career with

Deloitte.

John is a respected

organisational

psychologist, executive

coach and is the founder

and chief executive officer

of APS Intelligence Ltd, a

talent and leadership

development firm. He has

a diverse range of industry

experience, currently

serving on the Lloyd’s of

London culture advisory

group, the KPMG UK LLP

inclusive leadership board

and Sanofi’s diversity,

equity and inclusion board.

In addition, John is a

leadership training partner

with the National Health

Service (‘NHS’) and a

non-executive director

of Manchester University

NHS Trust. John also

previously served on the

Inclusive Advisory Panel

at Tesco.

John is a Chartered

Scientist, a Chartered

Fellow of the Chartered

Institute of Personnel and

Development and a Fellow

of the Royal Society for

Public Health. He is a

research fellow at the

University of East London

and his research interests

are effective, inclusive

leadership, building

high-performing teams

and organisational design

that maximises

productivity and human

thriving in readiness for the

future world of work.

Sly has extensive business

leadership experience

having been chief

executive officer for almost

ten years of one of the UK’s

largest media companies,

Trinity Mirror plc. She also

previously served as chief

executive officer of IPC

Media.

Sly has held a number of

listed and private board

roles, including serving as a

non-executive director of

Ladbrokes plc and EMI plc,

where she was also senior

independent director and

chair of the remuneration

committee. She has also

served as a non-executive

director and chair of the

remuneration committee

for the Press Association.

Sly currently serves as a

non-executive director of

IPSX Group Limited where

she is also chair of the

remuneration committee

and a member of the

nomination committee.

Sly’s broad knowledge

spanning a variety of

sectors enables her to

understand different

perspectives and business

circumstances

underpinning her

appointment as Senior

Independent Director. Sly’s

strong interest in employee

related matters has been

invaluable in her role as

Workforce Engagement

Director and Chair of the

Nomination and

Governance Committee.

Paul has considerable

executive and non-

executive director

experience in a variety of

UK and international

companies across a range

of industries.

Paul was previously chair

of Bibby Line Group and

a senior non-executive

director of Essentra Plc,

where he was chair of the

remuneration committee

and a member of the audit

and nominations

committees. Prior to this,

he spent nine years as

chairman and chief

executive officer of the

Wates Group. Paul

recently retired as

chancellor of Teesside

University and previously

served as president of the

Confederation of British

Industry and was chair of

Teach First, a UK

education charity.

Paul is currently a

non-executive director of

Cazenove Capital. He also

serves as chair of both the

International Chamber of

Commerce (UK) and

BusinessLDN. In July

2022, Paul was appointed

president of the Society of

Chemical Industry. He is

also a member of the

global advisory board of

Trinity College Dublin.

Linda brings a wealth of

experience and

knowledge in capital

markets and corporate

governance having spent

her executive career in

stockbroking and

investment banking. Linda

previously worked at NCB

Stockbrokers and Merrill

Lynch, and more recently

served as head of

corporate broking at

Goodbody Stockbrokers.

Linda is a non-executive

director of Kingspan

Group plc, a global leader

in insulation and building

envelope solutions, where

she serves as senior

independent director,

worker relations director,

chair of the remuneration

committee and is a

member of the

nominations committee.

Linda is also a non-

executive director of Cairn

Homes plc where she is

remuneration committee

chair and a member of the

audit and risk committee.

She is also vice chair of

Quanta Capital’s advisory

board and previously

served as chair of the Irish

Blood Transfusion Service.

Anne brings significant

experience spanning a

variety of sectors including

digital integrations, data

analytics, cultural change

programmes, and strategic

acquisitions and

partnerships. Anne

currently serves as vice

president of Meta’s

mid-market business

division for the EMEA

region. Prior to joining

Meta, Anne served as chief

executive officer of

Vodafone Ireland for nine

years, prior to which she

was managing director of

BT Ireland.

Anne previously served as

a non-executive director

of Vodacom Group Ltd,

South Africa’s leading

connectivity and financial

services company. She

also served as chair of

Goal Global, an

international humanitarian

response agency, from

2015 to 2021 and also as

president of the Dublin

Chamber of Commerce

from 2018 to 2019. Anne is

also a current board

member of IBEC CLG, a

business and employer

association for

organisations based in

Ireland and Ludgate, an

Irish non profit enterprise

facilitating job growth via

digital technology and

remote working hubs.

Helen brings substantial

operational, financial, risk

and UK retail experience

gained from senior finance

roles at Dixons, Forte,

Safeway and Lloyds

Banking Group.

Helen has significant

transformation experience

gained from her roles as

retail integration director at

Lloyds Banking Group and

as chief operating officer at

TSB Banking Group plc.

Helen has a probing focus

on cyber security, risk

matters, and internal

controls. In addition, she

understands the

importance of building a

diverse talent pipeline and

brings strong insight in this

area to the Board. Helen

also recognises the

fundamental importance

of embedding

sustainability into the

Group. As Sustainability

Engagement Director,

Helen acts as a strong

source of guidance and

support to both the Board

and colleagues on the

Group’s sustainability

agenda.

Helen is a fellow of the

Institute of Chartered

Accountants in England

and Wales, having trained

with Coopers & Lybrand.

Helen is a qualified

accountant and a highly

experienced finance

professional with extensive

board experience having

served as chief financial

officer of a number of

companies including Marks

& Spencer plc, John Lewis

Partnership, Lloyds Banking

Group and Kingfisher plc.

Helen is a member of the

supervisory board of the

retail company Ahold

Delhaize, where she chairs

the governance and

nomination committee and

is a member of the audit,

finance and risk committee.

She is also a non-executive

director of Superdry plc,

where she serves as senior

independent director, chair

of the nomination

committee and as a

member of the audit and

remuneration committees.

Helen is a non-executive

director of Compass Group

(the parent company of Bata

Shoes), where she also

chairs the audit committee.

Helen was appointed chair

designate of National

Express Group PLC with

effect from 1 October 2022.

Helen was previously

non-executive director

and chair of the audit

committees of Just Eat plc,

GEMS Education and Royal

Mail Holdings as well as

non-executive director of

SABMiller plc and Cineworld

plc.

Damien joined Greencore

in November 2022 and

leads our Legal and

Company Secretariat

functions. He has over 20

years’ experience as a

corporate lawyer and

senior executive across

Europe, the United States

and Asia. In his most

recent role as general

counsel and company

secretary of FTSE 250

listed UDG Healthcare plc,

Damien was responsible

for the group’s legal and

corporate secretarial

functions and also its risk,

sustainability, quality and

compliance functions.

Prior to this, Damien was

chief operating officer and

general counsel at Sysnet

Global Solutions, a

fast-growing global

technology business.

Damien trained and

practiced as a corporate/

merger and acquisitions

lawyer with Freshfields

Bruckhaus Deringer in

their London, Toyko and

New York offices and

subsequently with Maples

and Calder in their Dublin

office. He has also

completed executive

education programmes

most recently at

Cambridge University and

Columbia University.

Committee membership

Board

Committees

Audit and Risk

Nomination and

Governance

Remuneration

Committee Chair

56 Greencore Group plc Annual Report and Financial Statements 2022

Board Leadership and Company Purpose

Board leadership and company purpose

It is the responsibility of the Board to promote the long term

sustainable success of the Group and to generate value for all

stakeholders. The Board is responsible for setting the Company’s

purpose and strategy and for ensuring that these are aligned to the

Company’s culture.

Board leadership

The Board is committed to the delivery of a clear strategy,

underpinned by the three pillars of Growth, Relevance and

Differentiation. Throughout FY22, the Group has continued to

act in furtherance of each of these pillars despite ongoing external

macro-challenges. Our strategy is set out on pages 16 to 19.

An overview of the key activities of the Board for FY22 is set out on

pages 58 to 60.

Company purpose

The Board believes that articulating the Group’s purpose is key to

accelerating growth and deepening the Group’s impact among its

stakeholders. The Board recognises that embedding the Group’s

purpose is a cornerstone of its leadership role. We have always

been a purposeful business, and during FY22, the Board spent time

reviewing our progress on delivering our commitments set in FY20

(as detailed in our FY20 Annual Report and Financial Statements),

and how we live our purpose through our four differentiators of

People at the Core, Sustainability, Great Food and Excellence.

Making every day taste better

Our purpose reflects our ongoing ambitions to always strive for

better. Every day, under the Board’s leadership, our colleagues make

a positive contribution to the lives of many people, including by

providing convenient, nutritious and tasty food for our customers

and consumers whilst sourcing responsibly. The Board is responsible

for ensuring that we have processes in place to look after our

colleagues and care for our communities and the planet. Further

information on the Group’s purpose is set out on page 4 of the

Strategic Report.

How we are governed

How the Board operates

The Directors are responsible for the proper stewardship of the

Group’s affairs, both on an individual and collective basis, and it is

the Board alone that has the authority and responsibility for planning,

directing and controlling the activities of the Group.

There is an agreed procedure for Directors to take independent legal

advice at the expense of the Company in the furtherance of their

duties as Directors of the Company. In addition, the Directors are

indemnified for any legal action taken against them in respect of

matters pertaining to their duties as Directors, subject always to the

limitations under Irish company law.

Matters reserved to the Board

There is an agreed list of matters reserved for Board consideration

which is formalised in a Matters Reserved to the Board Policy. This is

reviewed annually and updated as appropriate. The Matters Reserved

to the Board Policy was last reviewed in November 2021 and is

available under the Investor Relations section of the Group’s website,

www.greencore.com.

Conflicts of interest

Under the Board’s formal Conflicts of Interest Policy, all Directors

have a duty to avoid a situation in which they have, or may have,

a direct or indirect interest that conflicts, or possibly may conflict,

with the interests of the Company while serving on the Board.

This Conflicts of Interest Policy was last reviewed in July 2022.

Directors are not permitted to vote regarding their own conflicts,

if any.

Board Committees

In order to assist the Board in the fulfilment of its responsibilities,

it has established an effective committee structure. Details of

the various Committees’ members, together with their relevant

biographies are set out on pages 54 and 55 of this Report. Further

details on the role of the Committees and the work undertaken by

each Committee in the year under review can be found on pages

72 to 108.

Our stakeholders

The Board is aware that our actions and decisions impact all of the

Group’s stakeholders and is committed to actively engaging with

and understanding the views of our different stakeholders and taking

their views into consideration. Read more on our engagement with

stakeholders throughout the year on pages 61 to 65.

57Strategic Report | Directors’ Report | Financial Statements

Governance structure

The Board

Collectively responsible for promoting the long term sustainable success of the Group. Its role is to lead and direct the Group by

setting the purpose and strategy, overseeing management and monitoring and assessing culture. Its focus is to ensure the long term

sustainability of the business, for the benefit of colleagues, customers, suppliers, consumers, shareholders and local communities.

Board Committees

Assist the Board in the fulfilment of its duties and responsibilities. Each Committee is responsible for reviewing and overseeing

activities within its particular Terms of Reference. The Chair of each Committee provides a summary of the proceedings of any

Committee meetings held since the previous Board meeting at each scheduled Board meeting.

Nomination and

Governance Committee

Oversees succession planning,

Board and Committee composition

and ensures effective corporate

governance processes.

Read more on page 50

58 Greencore Group plc Annual Report and Financial Statements 2022

Board activities and engagement with stakeholders

The Board’s approach is to have strong governance structures that fit the

needs of the business and ensure that we add value in all that we do. In

addition to the eight scheduled Board meetings, the Board formally

convened an additional 11 times during FY22. The following is a high

level overview of the key Board activities during the year.

Board strategy and business plans

Evaluated and debated presentations from management at the

annual two day strategy session

Approved and oversaw the implementation of the Group’s

Better Greencore programme and monitored progress via

regular Board updates

Considered key initiatives as part of the ongoing strategic

planning cycle

Received regular updates on new business opportunities with

new and existing customers

Approved £10m share buyback programme as part of

recommencement of value return of up to £50m over the next

two years

Received updates and monitored progress on the Group’s

sustainability strategy, the Better Future Plan which includes

climate impact and action, and climate related targets

Considered and approved material supplier and customer

contracts

Approved material capital expenditure

Received regular briefings from investor relations

See Strategy on page 16

Operating and financial performance

Reviewed commercial, operational and financial updates from the

Chief Executive Officer (‘CEO’)/Deputy CEO and Chief Financial

Officer

Received updates on the Greencore Excellence programmes

Reviewed and considered monthly reports, including management

accounts and details of performance against budget and the Group’s

financial position

Assessed the Group’s capital and financing requirements

Discussed and reviewed the Group’s budget presentation for FY22

and received updates on the Group insurance

Approved FY21 full year results, FY21 Annual Report and Financial

Statements, FY22 half year results, and FY22 first and third quarter

trading updates

Reviewed and discussed draft full year and half year financial results

presentations, for analysts and shareholders

Reviewed the post-close outlook

Received updates from the Chair of the Audit and Risk Committee on

its oversight of financial performance

Considered and approved the viability and going concern statements

for inclusion in the Annual Report and the Audit Committee’s advice

on making a ‘fair balanced and understandable’ (‘FBU’) statement in

the FY21 Annual Report

Considered and approved the Group Tax Strategy and Policy

Considered and approved the Group Treasury Policy

See Report of the Audit and Risk Committee on page 76

What the Board

did in FY22

59Strategic Report | Directors’ Report | Financial Statements

Governance

Received regular updates on the work undertaken by each of

the Board Committees

Received governance and compliance updates and considered

compliance with the 2018 UK Corporate Governance Code

Considered and approved Board Committee compositional

changes

Discussed contingency planning for the CEO role and

approved the appointment of Gary Kennedy as Executive Chair

for an interim period and Kevin Moore as Deputy CEO

Considered and approved the appointment of the CEO and the

Board Chair Designate and Non-Executive Director

Considered Non-Executive Director independence, including

the Board Chair

Approved the Notice of Annual General Meeting (‘AGM’) for

issue to shareholders and considered voting results,

shareholder feedback and engagement

Reviewed details of Board members’ external appointments

including associated time commitment

Considered the results of the externally facilitated Board and

Committee evaluation process commenced in FY21 and

agreed areas of focus for FY22

Led by the Board Chair, undertook an internal evaluation of the

Board’s and individual Director’s effectiveness for FY22

Reviewed the effectiveness of each of the Committees for FY22

Approved revisions to Terms of Reference of the Committees,

Board Chair and Senior Independent Director

Approved revisions to Terms of Reference for the roles of

Workforce Engagement Director and Sustainability Engagement

Director

Monitored progress on the Group inclusion and diversity

strategy and reviewed the Board Diversity Policy

Received updates from the Workforce Engagement Director

and Chief People Officer on colleague engagement initiatives

Undertook an annual review of Board policies and approved

amendments where appropriate

Approved the Group’s Modern Slavery and Human Trafficking

Transparency Statement and Gender Pay Gap Report

Received training and updates on legislation and regulation

Considered the Directors’ responsibilities under Section 225 of

the Companies Act 2014

See Composition, succession and evaluation on page 70

60 Greencore Group plc Annual Report and Financial Statements 2022

Board activities and engagement with stakeholders continued

Remuneration

Received regular updates from the Remuneration

Committee Chair on the activities of the Remuneration

Committee during FY22. Specific consideration was

given to:

• Feedback from shareholder consultation in response

to the outcome of the vote at the 2022 AGM on the

resolution to approve the FY21 Annual Report on

Remuneration;

• Draft 2023 Remuneration Policy, 2023 Performance

Share Plan and Restricted Stock Unit Plan, all to be

put to advisory shareholder vote at the 2023 AGM;

• Senior management remuneration matters;

• Recommendations on the remuneration for the

Board Chair designate and CEO; and

• Remuneration framework in the context of the wider

colleague base.

See Report on Directors’ Remuneration on page 83

Risk

In particular, consideration was given to:

• The effectiveness of internal controls and risk

management systems and internal controls

enhancements;

• Review of principal and emerging risks assessment

• Received regular updates on the IT security incident

recovery and progress on the Group’s security

improvement plan;

• Updates on risk deep dives undertaken by the

Audit and Risk Committee; and

• Received regular updates from the Audit and Risk

Committee Chair on the work undertaken in relation

to risk oversight during FY22.

See Risks and risk management on page 42

See Report of Audit and Risk Committee on page 76

61Strategic Report | Directors’ Report | Financial Statements

Our purpose-led stakeholder engagement

While the Code makes specific reference to section 172 of the United Kingdom’s Companies Act 2006, Greencore is incorporated in Ireland

andsubject to the requirements of the Companies Act 2014 of Ireland, rather than the 2006 UK legislation. Nonetheless, feedback from all

engagement activities is regularly considered by the Board as part of its decision-making processes as detailed in this section of the report.

Effective stakeholder engagement helps us better understand the impact of our decisions on all our stakeholders as well as their needs

andconcerns.

The Group’s purpose articulates our aim to create trusted relationships through effective engagement and to understand the needs of all our

stakeholders in order to deliver value and build a better, more resilient and sustainable business. The Board is aware that the Group’s actions and

decisions impact all of our stakeholders and it ensures that there is regular dialogue taking place with stakeholders, which is carried out by those

most relevant to the stakeholder group or issue, and discussed appropriately in the boardroom.

Our Sustainability Report 2022, which is due to be released at the end of January 2023 and will be available on www.greencore.com, sets out

how our purpose and sustainability strategy are interlinked with stakeholders in mind. The Group also has a Code of Ethics and Business Conduct

which set outs our fundamental principles and values directly applicable to our stakeholders. The Code of Ethics and Business Conduct is

available on www.greencore.com.

The importance of our relationships and regular dialogue with stakeholders was brought to the fore as we navigated our way through the

combined challenges associated with COVID-19 and the inflationary environment. The table below sets out the Board’s approach to stakeholder

engagement, why stakeholders matter and some key decisions made during FY22. To give greater understanding to this, we have provided clear

cross-referencing to where more detailed information can be found in this Annual Report and Financial Statements. Shareholders and other

stakeholders can be confident that the contents of our corporate reporting reflect the frameworks for strategy, stakeholder engagement,

governance, risk management and culture as established and overseen by the Board.

Why they matter How we engage

How the Board complements

engagement efforts

Shareholders

The Board

recognises the

importance of

engaging with all

shareholders and

prioritises effective

dialogue to ensure

that we capture

and embrace

feedback relating

to areas of interest

and areas of

concern, and to

ensure that our

obligations are met.

We understand that

we have a

responsibility to

ensure our

shareholders’

interests are

promoted and we

remain committed

to delivering value

for them.

The Group welcomes queries via telephone, post or email and up

to date contact details are available on the Group’s website, www.

greencore.com. The Investor Relations section of the website also

provides a library of all relevant shareholder communications,

financial results and updates, a regularly updated analysis of analyst

consensus estimates, and a history of the Company’s share price.

Attendance of, and questions from, shareholders at the Company’s

general meetings are welcomed by the Board. This year, our

shareholders were encouraged not to physically attend the

Company’s Annual General Meeting (‘AGM’) on 27 January 2022

due to the Irish Government’s COVID-19 restrictions and public

health guidance that were in place at that time on gatherings, and

to prioritise the health and safety of our shareholders. They were

instead invited to submit proxy instructions to ensure they could

vote and be represented at the AGM, without attending in person.

Shareholders had the option to listen live to the proceedings of the

AGM, by telephone or by audio and had the option to submit

questions in writing in advance of the AGM (either by post or by

email) or online during the AGM. The majority of the Board

attended the AGM either in person or via electronic facilities.

Shareholder presentations are made at the time of issue of the

Group’s half year and full year results. Q1 and Q3 trading updates

are also released in January and July respectively. In FY21 the

Group also released a FY21 and Full Year Trading Update.

During FY22, the Board and the Head of

Investor Relations maintained ongoing

engagement with existing and potential

investors.

The Board received regular updates on

analysts’ reports and share price

developments as well as on shareholder

relations, summarising key feedback from our

principal shareholders derived from an

investor relations programme comprising:

• One-on-one investor meetings with the

Board Chair, Chief Executive Officer (‘CEO’),

Chief Financial Officer and Head of Investor

Relations;

• Feedback from investors following meetings

and shareholder presentations on the

Group’s trading updates, half year and full

year results;

• Regular email and telephone contact with

investors and analysts;

• The Annual General Meeting; and

• Engagement with investors on ESG matters.

Shareholders through voting at the 2022

AGM, were given an opportunity to indicate

their opinion on the Annual Report on

Directors’ Remuneration for the year ended

24 September 2021. Whilst the advisory

resolution to approve the Report was passed,

a significant number of shareholders did not

support the resolution (with c.46% of

shareholders voting against). The Board and

Remuneration Committee consulted

extensively with shareholders both prior to

and following the 2022 AGM, to understand

their views on key decisions, and will continue

this open dialogue in future years.

Report on Directors’ Remuneration on page 83

62 Greencore Group plc Annual Report and Financial Statements 2022

Why they matter How we engage

How the Board complements

engagement efforts

Customers

Our strategy is to

deepen our

relevance with our

customers by

driving returns

through a shared

value chain,

increasing value

through our

portfolio and by

supporting in the

achievement of

jointly held

sustainablility

commitments. As a

food manufacturer,

the Board

understands the

importance of

building long term

partnerships with

our customers

through ongoing

engagement,

helping us better

understand not

only their needs,

but also the needs

of consumers. Our

ability to respond to

customer feedback

is paramount to

ensuring we deliver

great tasting,

sustainable quality

food to the highest

technical and food

safety standards.

The Group interacts with our customers on a daily basis at multiple

levels. We work closely with our customers to develop, improve

and refine our products through collaborative projects, market

research and innovation workshops. We welcome feedback from

our customers in relation to changing consumer demands and

carry out ongoing work to apply this in a manner that helps our

customers win throughout the supply chain. During FY22 we

developed and launched a number of new product ranges in

response to existing and emerging trends.

Increasingly, our customers are calling on us to support them in the

area of sustainability and we are committed to changing how we

do business and finding solutions that can feed a growing

population without causing harm to the planet. We continue to

collaborate closely with customers. The nature of our business

means we are significantly influenced by our customers’ strategies

and behaviours. Our product footprinting trial has been successful

and showed us how to eco-score an entire category, rather than an

individual product. This has huge potential to give us the data we

need to make decisions on product formulations. We recognise

that we need deeper conversations with our customers in order to

make this happen, and we are preparing for those discussions with

detailed market insight and robust internal data.

Throughout FY22, the Board received regular

updates on customer initiatives and

performance,and information on customer

and market insights and developing trends.

This assists the Board in understanding our

customers, the opportunities and potential

issues.

Customer feedback was shared regularly with

the Board including the Group’s responses to

the key issues impacting customers, such as

COVID-19, inflation and the availability of raw

materials.

The Board also reviewed our strategy on

Healthy and Sustainable diets, an area that

has been a key focus for us this year, in

particular the use of data to help guide our

delivery plans.

Strategy on page 17

Board activities and engagement with stakeholders continued

63Strategic Report | Directors’ Report | Financial Statements

Why they matter How we engage

How the Board complements

engagement efforts

Suppliers

The Group

operates a

sophisticated

supply chain that

ensures we can

procure,

manufacture and

distribute products

every day. The

Board fully

appreciates that

ongoing dialogue

with our suppliers

has never been

more important as

the UK food

industry continues

to face challenges

in respect of labour

availability, inflation

and material

sourcing. The

Group’s interaction

with our suppliers

on a daily basis is

essential given the

level of ingredients

and packaging

purchases we

make.

From time to time, we hold detailed workshops with key suppliers

to drive strategies for mutual benefit to reassure suppliers of our

stability, share our strategy on growth and sustainability and request

support on ramp up volumes and quality.

The Group recognises that there is an increasing focus on

sustainability with our suppliers, particularly in the areas of

sustainable sourcing, and working sustainably with our suppliers is

a critical part of our strategy. We work with suppliers to source in

ways that seek to protect ecosystems, reduce emissions and

enhance livelihoods. We engage with suppliers on climate related

issues, and work with them to ensure they are sourcing responsibly.

The ethical treatment of workers in the supply chain is also an

increasing area of focus. The Group carries out rigorous ethical

assessments of our raw materials to identify areas within our supply

chains that are most at risk of modern slavery and human rights

abuses. The Group also encourages our suppliers to operate to the

same ethical standards that we employ ourselves as outlined in the

Ethical Code and Employment Standard’s Policy. Furthermore,

Greencore is a member of the Supplier Ethical Data Exchange

(‘Sedex’) and we require all new raw material suppliers to our

business to be Sedex registered.

In order to ensure we meet our commitment of being a business

that sources every ingredient from a fairer and more sustainable

supply chain by 2030, we will continue to work with our suppliers

to learn as much as we can about where our ingredients come

from and how they are produced.

The Board approved the Group’s sustainability

strategy which details our commitment to

ensuring that by 2030 we will be a business

that sources our priority ingredients from a

fairer and more sustainable supply chain.

During FY22, the Board received updates in

relation to our progress against our three

sustainability pillars of Sourcing with Integrity,

Making with Care and Feeding with Pride.

The Board also considered our key supplier

relationships, how we are engaging with

those suppliers, the supply chain risk

assessments, and ethical audits that are in

place.

During FY22, the Board approved the Group’s

FY21 Modern Slavery and Human Trafficking

Transparency Statement.

Sustainability on page 23

Consumers

Consumers rely on

us on a daily basis

to provide them

with tasty, quality

food products. The

Board recognises

the importance of

understanding

changing

consumer

behaviours and

preferences and is

committed to

delivering Great

Food to ensure

their needs are fully

met.

To support our customers and consumer demand, the Group

carries out a significant amount of analysis on the different food

categories which we produce, focusing on how the category is

performing and the major trends in that category from a consumer

and marketplace perspective. To supplement these analyses, we

carry out specific direct consumer research from time to time to

better understand the contribution we can make to society,

especially when improving livelihoods or making healthier food

choices.

Together, the Board and management

discuss and consider the main findings of

these analyses and research, particularly at

the Group’s annual strategy session.

Market trends on pages 14 and 15

64 Greencore Group plc Annual Report and Financial Statements 2022

Why they matter How we engage

How the Board complements

engagement efforts

Colleagues

Our colleagues are

at the centre of the

success of our

business. They

bring our culture to

life not only in the

workplace but also

in our

communities. As

our colleagues are

intrinsic to how we

do business, the

Board recognises

the importance of

ensuring they have

the opportunity to

realise their

potential and

progress in their

careers, whilst at

the same time

providing

a safe working

environment that

promotes inclusion

and diversity.

The Group undertakes a significant number of engagement activities

with colleagues each year. We conduct an annual, anonymous,

‘People at the Core’ engagement survey which provides insight on

many areas of the colleague experience and allows colleagues to

share their views, both positive and negative, about their workplace.

We have colleague forums in place across all of our sites and also a

cross functional colleague forum at Group level. These forums meet

regularly with senior leaders to discuss key topics and issues and

enable active two-way dialogue.

We have a number of communication channels that enable two-way

dialogue and generate positive engagement – these include

fortnightly leadership calls, quarterly executive briefings with frontline

leadership teams and regular site team briefs. All of these sessions

include the opportunity for colleagues to ask questions of our

leadership and Executive teams. In addition, managers are

encouraged to solicit feedback from their colleagues, both formally

and informally and we have a feedback mechanism built into our

performance and appraisal system that enables colleagues to give

and receive feedback from managers, peers and their team

members.

In January 2022 we launched a UK Share Incentive Plan giving all

colleagues the opportunity to become Greencore shareholders. An

Irish Shadow Award Scheme was also put in place for our colleagues

in Ireland.

Our peer-to-peer listening service, Talk2Us continues to offer

colleagues a confidential service that they can use for emotional and

social support. This is a part of a range of occupational measures

which we have in place to support our colleagues. In addition, we

communicate quarterly wellbeing topics covering a wide variety of

occupational health issues to support colleagues with their mental

health. These include online seminars and fact sheets. During FY22

we launched our own wellbeing centre as part of our colleague

benefit platform – this provides colleagues with a whole host of

resources to support their physical, mental and financial health.

During FY22 colleagues also received regular updates from the CEO

and Deputy CEO, with a focus on how the business is performing in

relation to our four differentiators of People at the Core,

Sustainability, Great Food and Excellence.

Our engagement with colleagues is further strengthened by our

Workforce Engagement Director.

People and Engagement updates are

provided as part of the regular CEO update to

the Board. In addition, during FY22, the

Workforce Engagement Director and the

Chief People Officer provided updates to the

Board on the progress of our colleague

engagement initiatives and the results of such

engagement during FY22. As part of this, the

Board considered the ongoing recruitment

challenges for the Group and how we plan to

further improve colleague engagement going

forward.

The Board also meets and listens to the views

of colleagues as part of its site visits.

Sustainability on pages 27 to 28

Our Key Performance Indicators on pages 36

and 37

Engaging our workforce on pages 66 and 67

Board activities and engagement with stakeholders continued

65Strategic Report | Directors’ Report | Financial Statements

Why they matter How we engage

How the Board complements

engagement efforts

Local

communities

Our business

depends on the

communities in

which we operate.

We see it as our

responsibility to

actively engage

with and support

our local

communities

however we can.

Food is at the heart

of our business and

we strongly believe

that everyone

should have access

to good food. Food

has a significant

impact on health,

wellbeing and

development, and

can help to build

friendlier, stronger,

healthier

communities. The

extremely

challenging current

economic situation

means this is now

more important

than ever.

Food donation continues to be a central focus for our community

engagement efforts. We work with a number of food redistribution

organisations – including FareShare, The Felix Project, The Bread

and Butter Thing, and the Trussell Trust – in order to ensure our

surplus food reaches those who need it. Through these

partnerships we are able to redistribute short shelf life, chilled,

frozen, and bulk products, as well as any surplus from new product

trials. In FY22, we redistributed the equivalent of 1.63 million meals.

In 2022, we passed a milestone of the redistribution of the

equivalent of four million meals to FareShare during our

partnership, which was established in 2010, and were awarded

FareShare’s “Leading Food Partner” status, celebrating businesses

who have shown commitment to diverting surplus food to

FareShare to provide meals for people in need.

This year has also seen us continue the Ingredients 4 Life

partnership in collaboration with City Hearts. The initiative teaches

cookery to survivors of modern slavery, equipping them with life

skills, self-confidence and providing a safe space in which to build

trust with others.

During FY22, the Board received regular

updates from the Head of Sustainability in

relation to the Group’s sustainability

programme, our Better Future Plan.

Sustainability on page 24

66 Greencore Group plc Annual Report and Financial Statements 2022

Board activities and engagement with stakeholders continued

Greencore recognises that our colleagues are intrinsic to how we do business. Active

engagement has never been more important than over the last year as we have adapted

to new ways of post COVID-working.

During FY22 and in order to adapt to these new ways of working the Group together with the

assistance of our Workforce Engagement Director, Sly Bailey implemented several colleague

engagement initiatives, including the embedding of flexible working policies and the

introduction of annual colleague awards.

Sly ensures that our colleagues’ voices are heard in the boardroom and their interests are

taken into consideration when making important decisions.

Hosted a listening group with our cross-functional

salaried colleague forum members and met with

direct and indirect colleagues including union

representatives

Participated in the Group’s first annual Shine Awards

– a recognition event attended by 400 colleagues

Carried out an ongoing review of the Group’s

recruitment, selection and training processes

Reported to the Board on a number of colleague

engagement areas including recognition, retention

and recruitment challenges and talent management

Received updates from the Chief People Officer in

relation to our purpose, colleague development

plans and inclusion and diversity strategy

Input to the plans for the 2022 People at the

Core survey

Activities of the Workforce

Engagement Director during FY22

Engaging our workforce

67Strategic Report | Directors’ Report | Financial Statements

Further embedding our flexible approach to work and

supporting colleagues in availing of this where possible

Continued focus on safety and wellbeing as priorities

Further strengthening our inclusion and diversity strategy

through further involvement of colleagues across the

business in our plans, continuing to deliver an annual

calendar of inclusion events and sharing our colleagues’

stories

Encouraging each site to have a community plan in place

and where appropriate, supporting colleagues who wish to

volunteer in their local communities

Maintaining high levels of communication with our

colleagues through video, face-to-face briefings, our

quarterly colleague magazine and a new employee app

Delivering on our sustainability strategy and engaging

colleagues on the local activity that supports its delivery

Our plans to further improve

colleague engagement

“Honest, open and invaluable

discussions take place in the forums;

colleagues are listened to and more

importantly, the business acts where

necessary. Resulting in a personal

sense of pride at being able to

provide a conduit voice between

the business and colleagues.”

Direct feedback from a colleague forum member

– Autumn 2022.

68 Greencore Group plc Annual Report and Financial Statements 2022

Division of responsibilities

As set out on pages 56 and 57 of this Annual Report and Financial Statements, the Board is

collectively responsible for planning, directing and controlling the activities of the Group. The

Board’s responsibilities are set out in a formal Matters Reserved to the Board Policy. The Board is

currently made up of ten Directors: two Executive Directors and eight Non-Executive Directors,

one of which is the Board Chair.

Time commitment

Each year, a schedule of regular meetings to be held in the following

calendar year is agreed with each of the Directors. A list of the

Directors’ attendance at scheduled meetings throughout the year can

be found on page 69. Additional Board meetings are held on an ad hoc

basis as required throughout the year. As set out on page 69, during

FY22, largely as a result of Board compositional changes, the Board

and each of the Committees held additional unscheduled meetings.

Board meetings normally take place at the Group’s head office in

Dublin as well as at the Group’s sites wherein tours of the local facilities

and/or customer visits are also incorporated into the Board agenda.

Board papers are circulated electronically to Directors in the week

preceding the Board meetings. The Board papers include the minutes

of the previous Board meetings held and, where appropriate,

Committee meetings. In addition, the Chair of each Committee

provides a verbal update on the relevant Committee meeting’s

proceedings at the following meeting of the Board.

If a Director is unable to attend a Board meeting, either in person or

remotely, he or she is encouraged to communicate his or her views

on any particular topic to the Board Chair, the CEO, the Senior

Independent Director or the Group Company Secretary, in advance

of the meeting. These views are then communicated at the Board

meeting on behalf of the absent Director.

Where appropriate, the Board also establishes sub-committees

on an ad hoc basis in order to deal with any additional items of

business which arise throughout the year. The membership of the

sub-committees will depend upon the purpose for which it was

established and will take into account the skills and expertise

necessary.

Board Chair

Gary Kennedy

The roles of the Board Chair and Chief Executive Officer (‘CEO’) are separate and distinct and there is a

clear division of responsibilities between the two roles. It is the role of the Board Chair to lead the Board

and ensure its overall effectiveness in directing the Company, whilst demonstrating objective judgement

and promoting a culture of openness and debate. As noted on page 52, Gary Kennedy was Executive

Chair for an interim period during FY22 pending the appointment of Dalton Philips as CEO.

Chief Executive Officer

Dalton Philips

Reporting to the Board Chair, the CEO has overall responsibility for running the business, driving

shareholder value and developing strong relationships with stakeholders.

Chief Financial Officer

Emma Hynes

The Chief Financial Officer (‘CFO’) is primarily responsible for managing the financial affairs of the

Company and optimising its financial performance. The CFO is also responsible for Internal Audit and risk

management as well as the Company’s tax affairs.

Non-Executive Directors

John Amaechi

Sly Bailey

Paul Drechsler

Linda Hickey

Gary Kennedy

Anne O’Leary

Helen Rose

Helen Weir

The role of a Non-Executive Director includes providing entrepreneurial leadership, developing strategy,

scrutinising management performance and challenging management proposals in a clear and

constructive manner. Non-Executive Directors also utilise their skills, expertise and experience to

contribute to the development of the Group as a whole. Information on the time commitment expected

from each Non-Executive Director is set out below.

Senior Independent

Director

Sly Bailey

In accordance with best practice and the 2018 UK Corporate Governance Code, the Board has appointed

a Non-Executive Director as the ‘Senior Independent Director’. It is the role of the Senior Independent

Director to act as a confidential sounding board for the Board Chair and to serve as an intermediary for the

other Directors when necessary. The Senior Independent Director is available to shareholders, and other

stakeholders, if they have concerns which they have been unable to resolve through the normal channels

of Board Chair, CEO or CFO, or indeed where such contact through the aforementioned channels is

deemed inappropriate. Terms of Reference for the Senior Independent Director are approved by the Board

and are reviewed annually. A copy of the Terms of Reference for the Senior Independent Director can be

found on the Group’s website, www.greencore.com.

Company Secretary

Damien Moynagh

The Group Company Secretary, whose appointment and removal is a matter for the Board as a whole, is

responsible for advising the Board on all governance matters and ensuring that Board policies and

procedures are followed. The Group Company Secretary is available to each of the Directors for any

advice or additional support they may require.

69Strategic Report | Directors’ Report | Financial Statements

The Board held 19 scheduled and unscheduled meetings during FY22. Attendance at scheduled Board and Committee meetings held during

the year was as follows:

Scheduled meeting attendance during FY22

Board

Audit and Risk

Committee

Nomination and

Governance

Committee

Remuneration

Committee

Scheduled meetings held during the year 8 4 3 4

John Amaechi 8/8 3/3

Sly Bailey 8/8 3/3

Patrick Coveney

3/4

Paul Drechsler 8/8 3/3 4/4

Gordon Hardie

5/5 2/2 1/1

Linda Hickey 8/8 4/4 4/4

Emma Hynes 8/8

Gary Kennedy 8/8 3/3 2/2

Anne O’Leary 8/8 4/4 2/2

Dalton Philips

0/0

Helen Rose 8/8 4/4

Helen Weir 8/8 4/4

1. The Board and each Committee held additional meetings throughout the year. Further details on additional Committee meetings are set out in the respective

Committee reports.

2. Patrick Coveney resigned as Executive Director and CEO on 30 March 2022.

3. Dalton Philips was appointed as Executive Director and CEO and Director on 26 September 2022.

4. Gordon Hardie stepped down from his role as Non-Executive Director on 3 May 2022.

Site visit policy

The Board has a formalised Site Visit Policy (‘Site Policy’) for Non-

Executive Directors. Under the Site Policy, Non-Executive Directors

visit certain sites, absent Executive Directors, in order to gain a

deeper understanding of the relevant site and how the culture and

values of the Group are instilled. During FY22, Non-Executive

Directors had the opportunity to visit the sites at Park Royal and

Northampton, after which an update on the visits and associated

learnings was shared with the Board.

External appointment policy

The Board has a formalised External Appointment Policy

(‘Appointment Policy’) for Directors. The Appointment Policy

stipulates that in advance of any new Board appointment, each

potential new Non-Executive Director will be provided with

information on the time commitment expected of him or her for his

or her role. The potential Non-Executive Director is required to

provide a detailed overview of all other directorships and other

significant commitments together with a broad indication of the time

commitment associated with such other directorship(s) or significant

commitment(s). The proposed appointee must also confirm that

they have sufficient time to dedicate to the role and meet their

requirements as a potential Non-Executive Director of the Company.

Furthermore, all incumbent Directors must seek the prior written

approval of the Board in advance of undertaking any additional

external appointments. Before approving any additional external

appointment, the Board shall consider the time commitment

required for the role. Each proposed external appointment shall be

reviewed independently.

In addition to the above, in accordance with the Appointment Policy,

Executive Directors shall not normally be permitted to take on more

than one non-executive directorship in a FTSE 100 company or

other significant appointment, however, each proposed external

appointment shall be considered independently. In the event that

permission is granted for an incumbent Director to take on a

significant external appointment, full details of the rationale for

permitting such an appointment shall be clearly explained in the

Company’s Annual Report and Financial Statements.

In December 2021, Gary Kennedy was appointed Chair of Norcros

plc and in June 2022, he was appointed Chair of Goodbody

Stockbrokers, a subsidiary of AIB Group plc. Having assessed the

nature of these roles and the associated time commitment, the Board

was satisfied that Gary had sufficient time to commit to his role as

Chair of Greencore, including for the period when he was Executive

Chair. The findings from the FY22 annual evaluation of the Board

Chair confirmed that Gary had demonstrated significant

commitment in discharging his duties, including having sufficient

time to dedicate to his role as Executive Chair.

In October 2022, Helen Weir was appointed as a Non-Executive

Director and Chair Designate of National Express Group PLC and will

become its Chair with effect from 1 January 2023. At the same time

Helen elected to rebalance her portfolio and will step down from the

Greencore Board with effect from 31 December 2022. The Board

was satisfied that this appointment would not impinge on Helen’s

duties as a Non-Executive Director and Chair of Audit and Risk

Committee.

The Appointment Policy was reviewed in FY22 and minor

amendments were approved by the Board.

70 Greencore Group plc Annual Report and Financial Statements 2022

40%60%

80%20%

10%

10%70%10%

Composition, succession and evaluation

Board composition and independence

The Board consists of eight Non-Executive Directors and two

Executive Directors, being the Chief Executive Officer (‘CEO’) and the

Chief Financial Officer. A number of Board changes occurred during

FY22 which are detailed in the section entitled ‘Board succession and

changes to the Board’. The biographical details of each of the

Directors, along with each of their individual dates of appointment,

are set out on pages 54 and 55.

Collectively and individually, the Directors are highly experienced

with a wide range of skills, understanding and expertise which

facilitates effective and entrepreneurial leadership. The Directors’

individual capabilities, as well as the effective processes and

structures in place, ensure effective leadership of the Group and that

the highest standards of corporate governance are preserved.

The Board comprises individuals from a varied range of backgrounds,

each of whom brings independent judgement on a number of key

issues for the Group, including strategy, performance, operations,

culture, sustainability, health and safety, data analytics, leadership,

ethics and regulation, diversity, finance, risk and IT. This range of

backgrounds and expertise is invaluable to both the Board and the

Group as it continues to rebuild its economic and operating model

effectively and sustainably with all stakeholders.

At least annually, the Nomination and Governance Committee

undertakes a detailed review of Board and Committee composition

to ensure that there is effective succession planning in place and that

the Board and the Committees are of the appropriate size, structure

and composition, with no one individual or small group having the

ability to dominate decision making. Given the current composition

of the Board, no undue reliance is placed on any individual Non-

Executive Director and the Board is satisfied that it is sufficiently

independent in order to operate effectively.

In accordance with Provision 11 of the 2018 UK Corporate

Governance Code (the ‘Code’), at least half of the Board, excluding

the Board Chair, is considered independent. In accordance with

Board policy, the independence of each Non-Executive Director is

considered by the Nomination and Governance Committee prior to

appointment and independence is reviewed annually by the Board

and reassessed as necessary. The Board has determined that each of

the Non-Executive Directors (excluding Gary Kennedy) is

independent in character and judgement and free from any business

or other relationship that could affect their judgement.

The Board has had due regard to various matters which might affect,

or appear to affect, the independence of certain of the directors and

determined that arising from Gary’s performance of executive duties

during his tenure as Executive Chair from 31 March 2022 to

25 September 2022, he was no longer considered independent

effective from 31 March 2022. In assessing the independence of Sly

Bailey, the Board considered her length of service on the Board,

which is in excess of nine years, and formed the view that Sly has

always and continues to exercise independent judgement as a

Non-Executive Director, Senior Independent Director and as Chair of

the Nomination and Governance Committee. The Board concurred

that Sly brings an independent mind-set to Board and Board

Committee meetings and expresses her views independently of any

other relationships.

Board succession and changes to the Board

The Board Chair, Gary Kennedy, who was an existing Non-Executive

Director at the time of his appointment as Board Chair in January

2013, has been on the Board since November 2008. The key

considerations on the continuation of Gary’s tenure as Board Chair

until no later than the 2023 Annual General Meeting (‘AGM’) were

disclosed in the Nomination and Governance Committee Report in

the FY21 Annual Report. On 15 September 2022, the Board

announced that following a comprehensive Board Chair search and

selection process, it had appointed Leslie Van de Walle as Non-

Executive Director and Chair Designate and Leslie will join the Board

on 1 December 2022. Leslie will succeed Gary as Board Chair at the

conclusion of the AGM in January 2023 at which point Gary will retire

as Board Chair and from the Board.

Gordon Hardie stepped down from his role as Non-Executive

Director on 3 May 2022. Gordon played an invaluable role in driving

the Board’s agenda, strategy and purpose. He also sat on the

Remuneration Committee.

On 8 September 2022, the Board announced that Helen Weir had

elected to step down from the Board with effect from 31 December

2022. Helen’s focus on Board and Audit and Risk Committee matters

have been invaluable to both the Board and the wider Group.

The Board announced on 21 October 2022 that Paul Drechsler had

decided not to stand for re-election at the 2023 AGM. Paul has

brought great insight to and made a valuable contribution to the

Board and as a member of the Remuneration Committee and

Nomination and Governance Committee during his tenure.

The Board together with the Nomination and Governance

Committee keeps the composition of the Board under review, and

will continue to actively consider Board renewal and succession

planning during FY23 to ensure that it remains strongly positioned to

support and lead the Group into the future.

Further information in relation to Non-Executive Director

refreshment and succession planning is contained in the Report of

the Nomination and Governance Committee on pages 72 to 75.

Board evaluation

The Code specifies that the Board should undertake a formal and

rigorous annual evaluation of its own performance and that of its

committees and individual directors, and that the Board should have

an externally facilitated evaluation at least once every three years.

Board diversity as at 30 September 2022

Female Male Executive Non-Executive <1 year 1-5 years 5-10 years >10 years

By gender By role By tenure

71Strategic Report | Directors’ Report | Financial Statements

The Board recognises the importance of ensuring sustained

improvement to and enhancement of its effectiveness and

undertakes various phases of evaluation to facilitate this, as well as a

review of its independence. Each year, the Board conducts an annual

internal evaluation of its performance, which is led by the Board

Chair, as well as a triennial external evaluation.

For FY21, the Board engaged Independent Audit Limited

(‘Independent Audit’), an independent external consultancy firm to

conduct an external evaluation of the Board and its Committees and

the process undertaken by Independent Audit was described in the

FY21 Annual Report. Independent Audit has no other connection to

the Group or individual Directors.

The report on the findings of the FY21 external evaluation (‘FY21

Report’) was presented to the Board in January 2022. The report

concluded that the Board is operating effectively, and Non-Executive

Directors have a wide range of relevant and complementary skills

and independent views. It was noted that the Board is collegiate and

well led and benefits from an efficient and supportive secretariat. The

Committees are similarly well led, working diligently and operating

effectively. The relationship with management is positive and

constructive. As well as recognising the Board’s strengths, the Report

also contained some recommendations to further enhance the

Board’s effectiveness, including in relation to:

• The process and timing for the CEO and Board Chair

appointments;

• The further refinement of the Group’s strategic priorities and

tracking progress;

• Optimisation of Board time, with more definition around the

Board’s priorities; and

• Creating further cohesion within and evolving the modus

operandi of the Board, following recent Board renewal and

refreshment during the pandemic.

The Board reviewed progress on the areas of focus which were

agreed as part of the FY21 external evaluation, which will continue to

be built upon during FY23.

During FY22, the Board undertook a review of its operation,

performance and effectiveness, which was conducted using an

online questionnaire via Independent Audit Limited’s ‘Thinking Board

Evaluator’ portal. The results of the evaluation, including Board

members’ comments in each area as well as focus areas to enhance

the Board’s effectiveness were reviewed by the Board, following

which the Board agreed to:

• Enhance its focus on strategic objectives and priorities and more

effective use of Board time aligned to this;

• Give further consideration as part of succession planning to

development and performance of the executive team; and

• Continue its focus on strengthening the Board’s culture and social

capital and further evolving the modus operandi of the Board.

The review of the operation, performance and effectiveness of the

Board Committees was also conducted in FY22 using an online

questionnaire via Independent Audit Limited’s ‘Thinking Board

Evaluator’ portal and a performance evaluation discussion was

included on the agenda for each of the Committees, supported by an

analysis of how each Committee was performing against key areas of

its terms of reference. Each of the Board Committees concluded it

was operating effectively.

The Board Chair held private discussions with each of the Non-

Executive Directors regarding individual director performance. The

outcome of these evaluations was positive noting that each Director

continues to contribute effectively.

The Senior Independent Director led the annual evaluation of the

Board Chair which involved the completion of a detailed

questionnaire by each Director on the Chair’s performance and

effectiveness for FY22. The Senior Independent Director discussed

the findings of the evaluation with the Board Chair and then

presented the findings, as well as proposed areas for further

enhancement, to the Board.

Inclusion and diversity

Inclusion and diversity continues to be an area of focus for the Board

and for the Group as a whole. During FY22, the Board was updated

on the Group’s inclusion and diversity strategy. Colleague inclusion

and diversity in the Group is addressed through policy, practices and

values which recognise that a productive and engaged workforce

comprises different work styles, cultures, generations, genders and

ethnic backgrounds. The Board recognises the benefits of inclusion

and diversity and believes that having a diverse Board enables wider

perspectives which facilitates more effective discussions and decision

making. The Board is committed to ensuring that its composition is

diverse and balanced.

All Board appointments are made on merit against objective criteria,

in the context of the overall balance of skills, experience, expertise

and backgrounds that the Board needs to remain effective. The

Group’s Board Diversity Policy (available on www.greencore.com)

sets out the approach taken to ensure Board appointments support

and embrace difference and nurture an inclusive Board culture. In

this context, diversity not only encompasses gender, ethnic and

social ambitions/diversities, but also extends further to differing

experience, background, intellectual and personal styles. This ethos is

integral to the Nomination and Governance Committee’s approach

when carrying out its duty of reviewing the Board composition,

(including when considering new Board candidates) and as part of

the succession process for the Board Chair and CEO during FY22.

The Board is fully supportive of the recommendations of the

Hampton-Alexander Review and the Parker Review in respect of both

gender and ethnic diversity and aims to maintain Board

representation of at least 33% gender diversity. Together with the

Nomination and Governance Committee, the Board is committed to

ensuring that diversity forms a key element of Board refreshment and

succession planning.

The Nomination and Governance Committee reviews the Board

Diversity Policy annually, monitoring progress on diversity and, where

appropriate, reports on the process used in relation to any Board

appointments in the Group’s Annual Report and Financial Statements.

Detailed information in relation to the Board appointment process for

FY22 is set out on page 73.

72 Greencore Group plc Annual Report and Financial Statements 2022

Report of the Nomination and Governance Committee

“During FY22, we made significant

progress on the Board Succession Plan,

with the appointment of our new CEO

and the Chair Designate.”

Dear Shareholder,

As Chair of the Nomination and Governance

Committee (the ‘Committee’), it is my

pleasure to present the Committee’s report

for the year ended 30 September 2022

which sets out the Committee’s main areas

of focus over the past financial year.

The year under review saw significant

change in Board composition. In November

2021, Patrick Coveney informed the Board

that he would be stepping down as Executive

Director and Chief Executive Officer (‘CEO’)

on 30 March 2022.

The Committee initiated a robust process to

recruit his successor, led by our Board Chair,

Gary Kennedy. Following a comprehensive

search and selection process, on 13 May

2022, the Company announced the

appointment of Dalton Philips as Executive

Director and CEO effective 26 September

2022.

The Committee also continued to build on

its succession planning work of recent years,

most notably on the Board Chair selection

process, which culminated in the

announcement on 15 September 2022 of the

appointment of Leslie Van de Walle as

Non-Executive Director and Chair Designate

effective 1 December 2022. Both of these

appointments mark strong progress in our

Board Succession Plan.

The search processes for the CEO and Board

Chair were supported by MWM Consulting

who were engaged as the external search

agents. MWM Consulting has no connection

with the Group, or any individual director,

other than its work as advisors to the

Committee. Having supported the

recruitment of Non-Executive Directors in

FY20 and FY21, they had an understanding of

the skills and experience of existing

Directors, and were well placed to support

the Board in ensuring due consideration was

given to each appointment’s impact on the

composition of the Board as a whole. The

Committee is satisfied that the new Board

members enhance the overall skills profile

given the strategic direction of the Group

and bring a broad range of complementary

skills, knowledge and experience to the

Board.

Activities of the Committee

FY22 was another busy year for the

Committee as we continued our Board Chair

succession process and commenced our

CEO succession process.

During the year, in addition to the three

scheduled meetings, the Committee also

held ten unscheduled meetings. All

Committee members attended all scheduled

and unscheduled meetings, except for the

Board Chair who did not attend four

unscheduled meetings where the sole

purpose of the meeting was to consider

Board Chair succession.

Role of the Committee

The Committee’s responsibilities are outlined

in its Terms of Reference, which can be

found at www.greencore.com. The

Committee reviews and refers any proposed

amendments to its Terms of Reference to the

Board for approval annually. The Terms of

Reference were last updated in July 2022.

Membership of the Committee

The Committee currently consists of four

members: three Non-Executive Directors,

Sly Bailey, John Amaechi and Paul Drechsler,

who are considered to be independent and

the Board Chair, Gary Kennedy. Further

details on the Committee members’ skills,

qualifications, experience and expertise are

set out on pages 54 and 55. No Director

attends discussions relating to their own

appointment. In addition to members of the

Committee, the CEO attends meetings of the

Committee when it is considered appropriate

for him to do so.

Committee effectiveness

As noted on page 71, Independent Audit

Limited (‘Independent Audit’), an external

consultancy firm, was engaged to conduct

the FY21 external evaluation of the Board

and Board Committees. The FY22 review

of the operation, performance and

effectiveness of the Committee was

conducted using an online questionnaire

via Independent Audit’s ‘Thinking Board

Evaluator’ portal and a performance

evaluation discussion was included on the

agenda for the Committee at its September

2022 meeting, supported by an analysis of

how the Committee was performing against

key areas of its Terms of Reference. This

followed Independent Audit’s external

evaluation of the Committee for FY21 which

was completed in January 2022. Both reviews

Membership of the Committee

Committee members Date appointed

Attendance at

scheduled Committee

meetings during FY22

Sly Bailey 28 January 2014 (Appointed Committee Chair

on 28 January 2020)

3/3

John Amaechi 1 February 2021 3/3

Paul Drechsler 1 February 2021 3/3

Gary Kennedy 26 July 2012 3/3

73Strategic Report | Directors’ Report | Financial Statements

confirmed that the Committee continues to

operate effectively and efficiently and has

the skills and expertise required in order to

perform its role appropriately. In FY23, an area

of particular focus for the Committee is senior

management succession planning and

development, following the changes to

the Group Executive Team and to the

organisational model in FY22.

Board succession planning and

Board appointments

The Committee is responsible for ensuring

that the Company has a formal, rigorous and

transparent process in place for Board

appointments. Prior to making new

appointments to the Board, a role profile is

prepared on the basis of criteria laid down by

the Committee. This is preceded by an

evaluation of the skills, knowledge,

experience and diversity on the Board as well

as the anticipated time commitment for the

role. This process was followed by the

Committee as part of the Board Chair and

CEO succession processes and taking into

account the requirement for

complementarity between these roles.

Recommendations to the Board in respect of

the appointment of any given candidate,

follows a comprehensive due diligence and

rigorous assessment process, including

candidate interviews, which is undertaken to

enable the Committee to satisfy itself as to

the candidate’s skills, experience and

independence and their ability to devote

sufficient time to the role.

Letters of appointment of each of the

Non-Executive Directors detail the terms of

appointment and Directors’ responsibilities,

and also stipulate the time commitment

required from Directors. Copies of Directors’

letters of appointment are available to

shareholders for inspection at the Annual

General Meeting (‘AGM’) and at the

Company’s registered office during normal

office hours.

The Company’s Articles of Association

provide that at every AGM, each Director

shall retire and seek re-election. Under its

Terms of Reference, the Committee makes

recommendations to the Board concerning

the annual re-election of Directors. New

Directors may be appointed by the Board but

are subject to election at the first AGM after

their appointment. Both Dalton Philips and

Leslie Van de Walle will stand for election at

the 2023 AGM.

The Committee together with the Board

keeps the composition of the Board under

review, and will continue to consider Board

renewal and succession planning during

FY23 to ensure that it remains strongly

positioned to support and lead the Group

into the future.

Our Non-Executive Directors’ tenure on our

Board as at 30 September 2022 is as follows:

Length of Service

Number of

Non-Executive

Directors

Less than 1 year 0

Between 1 year and 3 years 5

Between 3 years and 5 years 1

Between 5 years and 10 years 1

Over 10 years 1

1. John Amaechi, Paul Drechsler, Linda Hickey, Anne

O’Leary and Helen Weir.

2. Helen Rose.

3. Sly Bailey.

4. Gary Kennedy.

Board succession planning and

Board Committees compositional

changes during FY22

The Committee plays a vital role in

promoting effective Board and leadership

succession, making sure it is fully aligned to

the Group’s strategy.

During FY22, the Committee reviewed the

size, structure and composition of the Board

Committees and Board succession planning.

Considerations included reviewing Director

tenure on the Board and the tenure of the

Sustainability Engagement Director, Senior

Independent Director, and Workforce

Engagement Director (with consideration of

the latter two roles, which are currently held

by me, being undertaken in my absence) as

well as Board Committees. The Committee

also oversaw the search processes for CEO

and Board Chair succession, both of which

were concluded in FY22. During the year

the Committee made recommendations to

the Board in respect of refreshing Board

Committee composition, taking into account

the requirements of the Committees’ Terms

of Reference, as well as the provisions of

the 2018 UK Corporate Governance Code

(the ‘Code’).

Provision 32 of the Code provides that the

“The board should establish a remuneration

committee of independent non-executive

directors, with a minimum membership of

three, or in the case of smaller companies,

two. In addition, the chair of the board can

only be a member if they were independent

on appointment and cannot chair the

committee”. As noted on page 70, the Board

considered Gary’s independence, and also as

noted below, his membership of the

Remuneration Committee prior to his

transition to the role of Executive Chair on

31 March 2022. Having determined that Gary

would no longer be considered independent

from that date, the Board concluded it was in

the Group’s best interests that he should

remain a member of the Remuneration

Committee during the CEO succession

process and consequently Greencore was

not compliant with this code provision from

31 March 2022 until 21 June 2022. On

21 June 2022, Gary Kennedy retired and

Anne O’Leary was appointed as a member

of the Remuneration Committee.

On 3 May 2022, Gordon Hardie stepped

down from the Board, and as a member of

the Remuneration Committee and the Audit

and Risk Committee. No changes were made

to the composition of the Nomination and

Governance Committee during FY22.

Executive succession planning

Executive succession planning, including

contingency planning for the CEO role, was

considered by the Committee on an ongoing

basis throughout the year, both prior to and

subsequent to the announcement on

25 November 2021 of Patrick Coveney’s

resignation as Executive Director and CEO

effective from 30 March 2022.

The search process for our new CEO, which

was led by the Board Chair, commenced in

November 2021. On 13 May 2022, following

a comprehensive search and rigorous

selection process, the Board announced the

appointment of Dalton Philips as Executive

Director and CEO and Dalton joined

Greencore on 26 September 2022. In

addition to his outstanding knowledge of the

grocery sector, Dalton has a strong track

record of leading dynamic consumer-related

businesses and we are confident he will

successfully lead Greencore into the next

phase of its journey.

Following Patrick’s resignation

announcement, the Committee

recommended the expansion of Kevin

Moore’s role to that of Deputy Chief

Executive Officer, as supported by the

Board’s contingency plan. This, together with

the appointment of Gary Kennedy to the role

of Executive Chair from 31 March 2022,

along with Emma Hynes as CFO, provided

continuity of leadership and an effective

management structure during the transition

period.

Board Chair succession planning

Work which had commenced on our Board

Chair search and selection process during

FY21 continued during FY22. The search was

led by me as Senior Independent Director

and overseen by the Committee with

support from the Board Chair Selection

Committee.

74 Greencore Group plc Annual Report and Financial Statements 2022

Report of the Nomination and Governance Committee continued

Following a comprehensive search process,

the Board Chair Selection Committee,

whose members were the Nomination and

Governance Committee members (excluding

the Board Chair) and Non-Executive Director

Linda Hickey, considered the shortlisted

candidates’ skills, experience, independence,

and their ability to commit sufficient time to

the role, taking into account the collective

skills and experience of, as well as diversity

on, the Board. At the conclusion of the

process, the Nomination and Governance

Committee recommended the final

preferred candidate to the Board and on

15 September 2022, the Board announced

the appointment of Leslie Van de Walle as

Non-Executive Director and Chair Designate,

effective on 1 December 2022.

As noted on page 52, Provision 19 of the

Code includes a provision whereby the chair

“should not remain in post beyond nine years

from the date of their first appointment to

the board.” Greencore currently deviates

Directorship experience

Listed Company Chair Experience

Non-Executive Director of Listed Company Experience

Executive Director of Listed Company Experience

Large Private Company Chair Experience

Non-Executive Director of Private Company Experience

Senior Independent Director Experience

Audit and/or Risk Committee Chair Experience

Audit and/or Risk Committee Membership Experience

Remuneration Committee Chair Experience

Remuneration Committee Membership Experience

Nomination and/or Governance Committee Chair Experience

Nomination and/or Governance Committee Membership Experience

General experience

International

Corporate Development/M&A

Scaling up

Retail/Food

Operational

Qualified Accountant (financial expertise)

IT/Technology

Consumer Insight

Scale Robotics Transformation

Legal

Experience Leading Diversity Initiatives

Transformation

from this provision, however, the Code

further outlines that “to facilitate effective

succession planning and the development of

a diverse board, this period can be extended

for a limited time, particularly in those cases

where the chair was an existing non-

executive director on appointment”. Now

that the appointment of Gary’s successor as

Board Chair has been announced, Gary will

retire as Board Chair and Non-Executive

Director at the AGM, to be held in January

2023 and Leslie will succeed Gary as Board

Chair at the conclusion of the AGM.

As noted on page 52, Provision 9 of the Code

provides that the “the role of chief executive

and chair should not be exercised by the

same person”. On 25 November 2021, the

Group announced that Patrick Coveney was

stepping down from his position as CEO and

Executive Director with effect from 30 March

2022. In line with the Board’s existing

contingency plan and pending the

appointment of a new CEO, Gary took a

more active role in the business and

assumed the role of Executive Chair from

31 March 2022. Greencore therefore

deviated from Provision 9 of the Code from

31 March 2022 until 26 September 2022, at

which point Dalton Philips joined the Board

as CEO and Executive Director and Gary

Kennedy reverted to his role as Non-

Executive Board Chair.

Company Secretary

Damien Moynagh was appointed Group

Company Secretary on 7 November 2022,

and replaces Jolene Gacquin, who resigned

from her position as Group Company

Secretary and departed the Group on

9 September 2022. In the interim period

from 9 September 2022 until 7 November

2022 Emma Hynes served as Group

Company Secretary.

75Strategic Report | Directors’ Report | Financial Statements

Directors’ induction and training

A considerable amount of time is dedicated

to the onboarding and induction of new

Directors and the Committee ensures that all

newly appointed Directors undergo a formal,

comprehensive and tailored induction

programme.

Each of the newly appointed Non-Executive

Directors also engages regularly with the

Board Chair and the CEO following

appointment to gain a further understanding

of the business. As part of their induction

programme, they are provided with detailed

information in relation to the Group’s history

and structure. They also receive data and

analysis on the Group’s people, sustainability,

commercial, strategic, operational, financial,

governance, risk management and capital

markets agenda.

There is also the opportunity for Non-

Executive Directors to visit our sites,

including as part of their initial onboarding,

in order to gain a deeper understanding

of the business.

Directors receive ongoing training and

development and the Board and Committees

receive regular updates and briefings on

relevant legal, environmental, social,

governance, regulatory and financial

developments, including from the external

auditor and external advisors.

Corporate governance developments

The Code continues to apply to the Group.

The Committee has developed a number of

policies and processes in order to enhance

corporate governance standards, each of

which were approved by the Board,

following recommendations from the

Committee. During FY22, each of the

policies were reviewed by the Committee,

updated where appropriate, and approved by

the Board.

Throughout FY22, we have continued to

keep up to date through ensuring agendas

were reflective of current issues and

information provided to members was

current and timely.

Inclusion and diversity

Recognising the significant benefits of

inclusion and diversity to Company strategy,

both the Board and the Committee are

committed to ensuring that they remain a

key area of focus for the Board and the

Group. In the year under review, the

Committee undertook a review of the Board

Diversity Policy to ensure that it remained

appropriate and no changes were

considered necessary. The Board Diversity

Policy is available under the Governance

section of our website, www.greencore.com.

We recruit talented Board members, who

have the appropriate mix of skills, capabilities

and market knowledge to ensure the Board

is effective. When recruiting, we look across

sectors and we require diversity on our

candidate shortlists. With 60% female

representation currently on the Board, we

have exceeded the recommendations of the

Hampton-Alexander Review, and are already

in compliance with the recommendations

of the Parker Review. In addition, the March

2022 Parker Review Committee update

confirmed that we met their Board ethnic

diversity recommendations. Diversity will

remain a key area of focus for the Board.

The Committee is proud of its progress in

this area and is committed to maintaining

balanced representation on the Board.

This is of fundamental importance as we

embed our recently developed inclusion and

diversity strategy across the Group.

The Group gender diversity breakdown,

which is set out on page 111, shows the

gender mix across the organisation. During

the year, the Board was updated in relation to

the current status and plans to improve the

Group’s inclusion and diversity profile. In

addition, progress on the Group’s inclusion

and diversity strategy, which sets the Group’s

aspirations was reviewed during the year. The

Committee will continue to monitor closely

the Group’s wider diversity initiatives and

progress against plans over the course of

FY23.

Overall it has been a year of good progress

and I would like to express my gratitude to

my colleagues on the Committee for their

ongoing dedication and commitment to

both the Board and the Committee.

Sly Bailey

On behalf of the Nomination and

Governance Committee

28 November 2022

76 Greencore Group plc Annual Report and Financial Statements 2022

Report of the Audit and Risk Committee

Dear Shareholder,

On behalf of the Audit and Risk Committee

(the ‘Committee’) and the Board, I am

pleased to present the Report of the

Committee for the year ended 30 September

2022 (‘FY22’) which is my final full year

serving as Committee Chair and as a Board

member. This report outlines how the

Committee discharged the responsibilities

delegated to it by the Board over the course

of FY22 and the key matters it considered in

doing so.

The Committee continued to focus on its

core areas of responsibility, namely

protecting the interests of the Group, our

shareholders and our stakeholder base

through ensuring the integrity of the Group’s

financial information, audit quality and the

effectiveness of internal controls, the risk

management process, and transparent

financial reporting throughout the year.

Role of the Committee

The Committee’s role, authority, duties and

scope are set out in its Terms of Reference

which are available on the Governance section

of our website, www.greencore.com. The

Committee reviews the Terms of Reference

annually and any amendments are presented

to the Board for approval. The Terms of

Reference were last reviewed in May 2022.

Membership of the Committee

Committee members Date appointed

Attendance at

scheduled Committee

meetings during FY22

Helen Weir 1 February 2020 (Appointed Committee Chair

on 26 January 2021)

4/4

Linda Hickey 1 February 2021 4/4

Anne O’Leary 1 February 2021 4/4

Helen Rose 11 April 2018 4/4

Gordon Hardie (Appointed 26 January 2021 and stepped down

on 3 May 2022)

2/2

Membership of the Committee

The Committee is currently comprised of

four Non-Executive Directors, all of whom

are considered by the Board to be

independent. As a whole, the Committee

possesses the skills, competence and relevant

financial and commercial experience across

a variety of industries, including the

consumer goods and food sectors, to enable

it to effectively discharge its responsibilities.

Helen Rose and I both have recent and

relevant financial experience, whilst all

Committee members are financially literate.

Having been involved in risk management in

TSB Banking Group plc, Helen Rose also has

specific risk expertise.

Gordon Hardie stepped down from the

Committee and the Board on 3 May 2022.

Iwould like to take this opportunity to thank

him for his dedication and contribution to

the Committee during his tenure.

Further details on the Committee members’

experience and qualifications can be found

in our biographical details as set out on

pages 54 and 55.

In accordance with the Committee’s Terms

of Reference, the Group Company Secretary

or their nominee acts as Secretary to the

Committee.

Committee meetings

During FY22, the Committee held six

meetings (four scheduled and two

unscheduled meetings), primarily to review

the control framework and risk and

assurance system. All Committee members

attended all scheduled and unscheduled

meetings which they were eligible to attend.

The meetings of the Committee are

generally scheduled to take place in advance

of Board meetings. This allows me to provide

the Board with a detailed update on the key

items discussed at the Committee meetings.

The Board also receives copies of the

minutes of the Committee meetings.

During FY22, regular attendees at Committee

meetings included the Chief Executive Officer

(‘CEO’) and, subsequent to his resignation, the

Executive Chair and Deputy CEO, as well as

the Chief Financial Officer (‘CFO’), the Group

Financial Controller, the Head of Risk

Management until his departure and

subsequently the Director of Internal Audit

and Risk, the Head of Legal and Compliance

and the IT Director. Representatives of the

external auditor, Deloitte Ireland LLP

(‘Deloitte’), also attended each scheduled

meeting. In addition, other individuals from

the Group attended Committee meetings and

provided the Committee with updates on

certain key areas of the business, as

requested, including the Chief People Officer

and Chief Operating Officer.

In my capacity as Chair of the Committee,

I am available to all Board members to

discuss any audit or risk related issues they

may have, either on a collective or individual

basis. During FY22, I met with the external

auditor and the Head of Risk Management/

Director of Internal Audit and Risk,

without management, on a regular basis.

The Director of Internal Audit and Risk,

whose appointment or removal is subject

to Committee approval, has direct access

“During FY22, the Committee continued

tofocus on the effectiveness of internal

controls, including IT processes and

controls, and strengthening the oversight

provided by the Internal Audit function.”

77Strategic Report | Directors’ Report | Financial Statements

to both myself and the Board. During

theyear the Committee approved the

appointment of the Director of Internal

Auditand Risk following the departure of the

Head of Risk Management from the Group.

Risk management and

internal controls

The Committee supports the Board in its duties to review and monitor, on an ongoing basis, the effectiveness of

the Group’s system of internal control and risk management.

In order to fulfill these duties, during the year under review, the Committee:

• Received regular reports from the Risk Oversight Committee (‘ROC’), chaired by the CFO. The ROC was

established to support the Committee with ongoing monitoring of the risk management process;

• Monitored progress on the action plan to implement the recommendations made by KPMG following their external

quality assessment of the Risk Management Group, including the creation of separate Internal Audit and Risk

Management functions both of which report to the newly created position of Director of Internal Audit and Risk;

• Formally met with the Head of Risk Management/Director of Internal Audit and Risk who provided reports on

the key audit findings, themes and key issues noted throughout the reviews and progress on closure of actions

including any overdue actions resulting from business process and control reviews;

• Received progress updates on the FY22 Internal Audit Plan which covered, amongst other areas, business

continuity planning, financial controls, production performance, stock management and HR practices as well as

standard operational reviews;

• Reviewed and approved the FY23 Internal Audit Plan which sets out the planned activities for the year ahead, as

well as Internal Audit staffing and resources. The FY23 plan is informed by an assessment of the risk profile of

the different areas of the business;

• Agreed the Risk Management Framework and reviewed the Group Risk Appetite Statement;

• Received presentations on principal and emerging risks and discussed, with senior management, the material

internal controls and assurance processes which exist to mitigate and manage these risks in accordance with

the Board’s risk appetite;

• Considered the impact of the IT security incident as detailed below on the internal control environment,

undertook a deep dive into cyber risk and reviewed the controls that have been put in place by management to

manage and mitigate cyber risk;

• Reviewed the risk assurance process for food safety and health and safety;

• Undertook deep dives on labour and people risk and discussed the effectiveness of the risk assurance processes

and internal controls to mitigate and manage these risks; and

• Reviewed the Group’s Treasury Policy.

In light of the above and the work performed in relation to the IT security incident, which is detailed below, the

Committee continues to be satisfied that the Group’s internal control environment remains appropriate and

effective and has reported this opinion to the Board.

IT security incident

In FY22, the Group experienced an IT security incident that resulted in temporary unauthorised access to part of the

Group’s IT systems. From a financial reporting perspective, while the IT security incident did lead to some

temporary disruption to regular procedures, the Group’s internal reporting procedures continued with significant

effort made by the Group’s finance teams to ensure that there were no gaps in the recording of transactions.

The Committee was updated on the impact of the incident on the business and the early mitigating actions taken

to minimise impact and/or risk in the scheduled January 2022 meeting. Further updates were provided to the

Committee in March 2022 and May 2022. These included recommendations from external advisors on the

appropriate remediation activities as part of response and recovery following the incident. In the September 2022

Committee meeting, the Committee received updates on IT security processes that have been implemented as part

of the recovery process and residual IT security risks as, in common with other companies, the risk of future IT

security incidents remains one of the Group’s principal risks.

The updates provided to the Committee during the year and the actions taken by management in containing and

responding to the IT security incident, provided the Committee with assurance that the Group’s internal control

framework, including IT processes and controls, remained effective for FY22.

How the Committee has discharged

its responsibilities during FY22

Key areas of focus

The Committee has an extensive agenda

which focuses on monitoring the

effectiveness of risk management within the

Group as well as ensuring the integrity of the

Group’s financial reporting, that any

judgements made are appropriate, that the

external auditor is effective in its role and that

the Group has an effective internal control

framework. During FY22, the work of the

Committee principally fell under the

following key areas:

78 Greencore Group plc Annual Report and Financial Statements 2022

Report of the Audit and Risk Committee continued

Financial reporting

The Committee reviewed the form and content of the Annual Report and Financial Statements, as well as the half

year and full year results statements including the key estimates and judgements made by management in the

preparation of the Financial Statements.

During FY22, the Committee:

• Considered the FY22 Interim Results Statement and the FY21 Full Year Financial Statements. The Committee

reviewed and challenged management on the appropriateness of estimates and judgements made in the

preparation of the Financial Statements;

• Reviewed the judgements made with respect to which items should be disclosed separately as exceptional

items in the Financial Statements to confirm that these were in line with policy. In FY22, the reorganisation costs

for the Group’s Better Greencore programme and professional fees in relation to the pension restructure have

been disclosed separately as exceptional items in line with the Group’s accounting policy;

• Considered the Group’s tax compliance and tax strategy;

• Reviewed papers on the Group’s significant accounting judgements and estimates;

• Reviewed the Group’s accounting policies and management’s assessment of the impact of IFRS amendments

effective during FY22 on the financial statements and the potential impact of upcoming amendments to IFRS on

the Group; and

• Received updates regarding the impact of the IT security incident on financial reporting procedures.

External audit

The Committee provided oversight in relation to the external auditor’s relationship with the Group including

agreeing the external auditor’s terms of engagement and monitoring the independence and objectivity of the

external auditor, Deloitte. The remuneration of the external auditor was considered and an increase in fee reflective

of cost inflation in the professional services market was approved by the Committee.

In November 2021, the Committee also discussed the FY21 external auditor’s report to the Committee with

Deloitte, considering their findings, conclusions and the recommendations arising from their work. They also

reviewed and agreed the Letter of Representation.

Progress on the implementation of the recommendations from the external auditor and updates to internal

controls formed part of the management reports to the Committee during FY22.

The Committee met with Deloitte in January, May and September 2022 to consider and challenge the scope of the

annual FY22 external audit plan, which was set taking into consideration the nature of risks to, and the strategy of,

the Group.

Directors’ compliance

statement

The Committee reviewed the appropriateness of the Directors’ Compliance Policy Statement and also considered

reports from senior management in respect of the compliance structures and arrangements in place for the year

under review to ensure the Company’s material compliance with its relevant obligations. Following the review, as

well as a review of the report from the Internal Audit and Risk Management function in respect of the compliance

structures and arrangements, the Committee confirmed to the Board that, in its opinion, the Company is in

material compliance with its relevant obligations.

Going concern and

viability statement

The Committee’s role as delegated by the Board, is to carry out an assessment of the adoption of the going

concern basis of accounting and report to the Board accordingly. The Committee challenged and scrutinised

management’s detailed assessment of the Group’s going concern model, including examining and challenging the

underlying assumptions and analysis presented in support of the going concern statement. Financial models based

on a number of scenarios which included inflation, recession and supply side disruption were considered by the

Committee along with an assessment of the borrowing facilities available to the Group. Further information is set

out below and on pages 44 and 45.

For the purpose of the viability statement, the Committee’s role, as delegated by the Board, is to review the

underlying processes and key assumptions underpinning the viability statement and report to the Board

accordingly. The Committee reviewed management’s work on assessing the Group’s current position and potential

risks facing the Group including the results of the financial modelling of the principal risks identified as having the

greatest potential impact on the Group’s viability and the Group’s ability to meet its liabilities in the medium term,

as well as the appropriateness of the Group’s choice of a three year assessment period. Following this review, the

Committee was satisfied that management had conducted a robust assessment of the Group’s emerging and

principal risks and recommended to the Board that it approve the viability statement, as set out on page 45.

79Strategic Report | Directors’ Report | Financial Statements

Monitoring the integrity of the FY22 Financial Statements including significant judgements

• We reviewed the appropriateness of Group accounting principles, practices and policies and monitored changes to, and compliance with,

accounting standards;

• We reviewed the half year and full year results statements for FY22. Before recommending their release to the Board, we compared the

results to management accounts and budgets, focusing on key areas of judgement and also discussed the statements with the external

auditor; and

• We reviewed, prior to making recommendations to the Board, the Annual Report and Financial Statements for the year ended

30 September 2022.

In undertaking our review, we discussed with management and the external auditor the critical accounting policies and judgements that had

been applied. These were:

Going concern

The Committee reviewed the Group’s assessment of going concern which is for a period of 18 months from the

year end date. Management presented a number of stress scenarios to the Committee which considered the

estimated potential impact of inflation, recession and supply side disruption, along with the Group’s own mitigating

actions on costs and cashflows. In assessing going concern, the Committee also reviewed the steps taken by

management to ensure adequate liquidity is available to the Group and also covenant requirements. The

Committee concluded that it was appropriate to recommend the adoption of the going concern basis in preparing

the Financial Statements.

Goodwill

The Group had goodwill of £449.4m at 30 September 2022 as set out in Note 12 to the Group Financial Statements.

Management’s judgement is required in testing the carrying value of goodwill for impairment when comparing the

value in use of the cash generating unit (‘CGU’) to the carrying value. The value in use was calculated using

cashflow projections based on the Group’s approved budget and strategic plans which were then projected out to

perpetuity. The Committee considered the methodology applied and the key assumptions used in the assessment,

which included future profitability, terminal growth and discount rates. The Committee was satisfied that there was

sufficient headroom and that no impairment was required.

Accounting for

exceptional items

The Group accounting policy sets out the items that the Group believes it is appropriate to disclose separately as

exceptional items. Management’s judgement on whether an item should be classified as exceptional are presented

to the Committee as part of the papers provided to the Committee on significant judgements and estimates. The

Committee also challenges management on items that may not have been classified as exceptional. The

Committee was satisfied that it was appropriate to classify the costs associated with the Better Greencore

programme and the pension restructuring costs as exceptional items in the FY22 Financial Statements.

Taxation

Provisions for current and deferred taxation require judgement including where the treatment of certain items may

be the subject of debate with tax authorities. The Committee received updates relating to both the interim and

FY22 accounting judgements and estimates around the Group’s tax profile and provisions. The Committee

considered the appropriateness of the provisions and the supporting information provided by management. The

Committee was satisfied that the accounting and disclosures relating to provisions for taxation are appropriate in

the FY22 Financial Statements.

Provisions

The Group has provisions for lease obligations, remediation and closure and other provisions for potential litigation

and warranty claims. In FY22, the Group also included a provision for costs relating to the Better Greencore

programme. Following discussions with management, the Committee was satisfied with the completeness and

classification of the provisions for FY22.

Greencore Group plc

investment in

subsidiaries

(Company only)

The Company has an investment in subsidiary undertakings of £766.6m. Management performed a review of the

recoverability of the Company’s investment in subsidiaries by performing a bottom-up review of the investments

throughout the Group to determine if an impairment was required. On the basis of this analysis, the Committee

was satisfied that an impairment of the Company’s investment in subsidiaries was not required.

80 Greencore Group plc Annual Report and Financial Statements 2022

Report of the Audit and Risk Committee continued

Fair, balanced and understandable

assessment

Each year, in line with Provision 25 of the 2018

UK Corporate Governance Code (the ‘Code’)

and the Committee’s Terms of Reference,

the Committee is asked by the Board to

consider whether or not, in its opinion, the

Annual Report and Financial Statements are

fair, balanced and understandable (‘FBU’) and

whether or not it provides the information

necessary for shareholders to assess the

Group’s position and performance, business

model and strategy.

There is an established process in place to

support the Committee in making this

assessment. The main elements of this

process are:

• An internal FBU Group comprising senior

management from Finance, Legal and

Transformation considered the draft FY22

Annual Report and Financial Statements

focusing on a number of ‘key areas of

focus’ as outlined below;

• In advance of its November 2022

meeting, the Committee received a

near-final draft of the FY22 Annual Report

and Financial Statements, together with

the list of areas to focus on;

• At the November meeting, the FBU Group

reported its observations and

conclusions, including supporting

evidence, to the Committee; and

• The Committee discussed the findings of

the FBU Group, as well as the

observations of individual Committee

members, and the external auditor.

Following its review this year, the Committee

concluded that it was appropriate to confirm

to the Board that the FY22 Annual Report

and Financial Statements were fair, balanced

and understandable and provided the

information necessary for shareholders to

assess the Group’s position, performance,

business model and strategy. The FBU

statement appears on page 116 of the

Directors’ Report.

The ‘key areas of focus’ included ensuring

that:

• The overall message of the narrative

reporting is consistent with the Financial

Statements;

• The overall message of the narrative

reporting is appropriate, in the context of

the industry and the wider economic

environment;

• The FY22 Annual Report and Financial

Statements is consistent with messages

already communicated to investors,

analysts and other stakeholders;

• The FY22 Annual Report and Financial

Statements, taken as a whole, is fair,

balanced and understandable;

• The Chair’s statement and Chief Executive

Officer’s review include a balanced view

of the Group’s performance and

prospects, and of the industry and market

as a whole;

• Any summaries or highlights are balanced

and reflect the position of the Group

appropriately; and

• Examples are of strategic importance and

do not over-emphasise immaterial matters.

Risk management and

internal control

The Board has overall responsibility for the

Group’s system of internal control and risk

management and determines our strategic

approach to risk. The Board’s approach to

risk management is set out in the Risks and

risk management section of this Report on

pages 42 to 49. The Committee reviews the

effectiveness of the system and ensures that

there is a process in place for identifying,

evaluating and managing the significant

risks to the achievement of the Group’s

strategic objectives.

Under Irish company law (Section 327(1) (b)

of the Companies Act 2014) and Provision 28

of the Code, the Directors are required to

give a description of the principal risks and

uncertainties which the Group faces. The

principal risks and uncertainties identified are

set out on pages 46 to 49 and form part of

the Directors’ Report. The principal risks

facing the Group include people risks,

operational risks, strategic risks, commercial

risks and financial risks. The impact of the IT

security incident and the impact of the cost

of living increases and inflation have been

taken into account when considering the

principal risks.

Whilst the Board as a whole is responsible

for the Group’s system of internal control,

the Board has delegated responsibility

for monitoring the effectiveness of the

Company’s risk management and internal

control systems to the Committee. The

Committee oversees a risk-based internal

audit programme, including periodic audits

of the risk processes across the Group. In

order to monitor the effectiveness of the risk

management system, the Committee also

includes risk deep-dives on its meeting

agenda, covering key risk areas across the

Group, and receives reports on the efficiency

and effectiveness of internal controls. Each

of the individual areas of the business and

functional management teams oversee the

process through which principal and

emerging risks and uncertainties relating to

their part of the business are identified.

The Board believes that the individual

business areas and functional management

teams are best placed to identify the

principal and emerging risks and

uncertainties associated with their respective

areas of business. During FY22, the

Committee reviewed reports from the ROC,

which provided ongoing monitoring and

evaluation of the risk environment, and risks

identified by individual business areas and

functional management, and the controls in

place to manage those risks. In addition, the

ROC reviews and considers emerging risks

which may impact the Group in the future.

Risks identified and associated mitigating

controls are subject to review by the Board

and the Committee on a regular basis.

The process for identifying, evaluating and

managing risk has been in place throughout

the financial year. This system of internal

control is designed to manage and mitigate,

rather than eliminate, the risk of failure to

achieve business objectives. The internal

control systems can only provide reasonable

assurance, rather than absolute assurance,

against material misstatement or loss. Our

internal controls and risk oversight are

monitored and continually improved to

ensure their compliance with the Financial

Reporting Council Guidance on Risk

Management, Internal Control and Related

Financial and Business Reporting.

In analysing and reviewing risks, the

Committee and the Board consider:

• The nature and extent of the risks,

including principal risks facing the Group,

as well as emerging risks;

• The extent and categories of risks it

regards as desirable or acceptable for the

Group to bear;

• The likelihood of the risk concerned

materialising and the impact of associated

risks materialising as a consequence;

• The Group’s ability to reduce the

incidence and impact on its business of

risks that do materialise;

• The operation of the relevant controls

and control processes;

• The costs of operating particular controls

relative to the benefits in managing

related risks; and

• The Group’s risk culture.

The key elements of the Group’s system of

internal control are as follows:

• Clearly defined organisation structures

and lines of authority, including delegated

authorities;

• Corporate policies for financial reporting,

treasury and financial risk management,

information technology and cyber

security, project appraisal, capital

expenditure and corporate governance;

• Annual budgets and strategic business

plans for the Group, identifying key risks

and opportunities;

81Strategic Report | Directors’ Report | Financial Statements

• Monitoring of performance against

budgets and forecasts and reporting

thereon to the Directors on a regular

basis;

• The Internal Audit function which

independently reviews key business

processes and controls and their

effectiveness; and

• The Audit and Risk Committee, which

approves audit plans, monitors

performance against plans and deals with

significant control issues raised by Internal

Audit or the external auditor.

The preparation of financial reports is

managed by the Group Finance team. The

Group financial reporting process is

controlled using the Group accounting

policies and reporting systems. The Group

Finance team provides guidance on the

preparation of financial information. The

Group seeks to continually test and improve

its internal control environment.

Details of the Group’s hedging and financial

risk management policies are set out in Note

21 and 22 to the Group Financial Statements,

respectively. Details of the Group’s financial

Key Performance Indicators (‘KPIs’) are set

out on pages 34 and 35. These disclosures

form part of the Directors’ Report.

During the year under review, Internal Audit

co-ordinated the Business Internal Control

Questionnaire, a self-assessment by senior

management on the effectiveness of key

controls. The purpose of this questionnaire is

for management to identify any control

weaknesses, which are subsequently

addressed. This year’s self-assessment

particularly focussed on internal controls

over financial reporting.

Finally, the Directors, through the use of

appropriate procedures, systems and the

employment of competent personnel, have

ensured that measures are in place to secure

compliance with the Company’s obligation to

keep adequate accounting records which are

kept at the registered office of the Company.

Whistleblowing arrangements

At Committee meetings held during the year,

the Committee reviewed the Group’s

arrangements for colleagues and/or third

parties to raise concerns, in confidence,

relating to ethical, auditing or other risk

issues and/or improprieties or areas of

concern. The Committee received reports

on all concerns which had been raised either

via the Group’s externally facilitated and

independent whistleblowing hotline, or via

alternative means (for example, by email

direct to the Company). The Group’s

externally facilitated whistleblowing hotline

is operated by an independent external

provider, is multilingual and is accessible

to all colleagues and third parties either

by phone (toll free 24 hours per day,

7 days a week), or via a web portal.

In reviewing the reports, the Committee

also analysed the issues raised by location,

category of concern raised and investigation

process along with the outcome of the

investigations into the issues.

The Group recently undertook a

benchmarking exercise of its whistleblowing

arrangements to help inform improvements

required and all improvements identified

have now been embedded into the Group’s

processes. The arrangements in place across

the Group are underpinned by the Group’s

Whistleblowing and Speak Up Policy as well

as the Group’s Code of Ethics and Business

Conduct. There are whistleblowing posters

on notice boards at all Greencore sites and

whistleblowing arrangements are explained

to all new colleagues as part of their

induction. The Group is at all times

committed to ensuring that any concerns

raised however received are appropriately

investigated.

External audit

The Committee, on behalf of the Board, is

responsible for the relationship with the

external auditor and for monitoring the

effectiveness and quality of the external audit

process. The assessment of the external

audit forms an integral part of the

Committee’s activities. The Committee

evaluates the effectiveness of the external

audit through an assessment of external and

internal factors taking into consideration the

Group’s business model and strategy,

business risks, and its perception of the

reasonable expectations of the Group’s

stakeholders. Following a formal audit tender

process, which was conducted in FY17,

Deloitte was appointed as the Group’s

external auditor and FY19 marked the first

year of the Deloitte external audit. The lead

partner for the audit of the Group’s Financial

Statements in respect of FY22 is Kevin

Sheehan.

In November 2022, in advance of the

finalisation of the Group’s FY22 Annual

Report and Financial Statements, the

Committee received a report from Deloitte

on its key audit findings, including the key

risk areas and significant judgements. In

addition, the Committee considered the

Letter of Representation and the

management letter.

Effectiveness

During FY22, the Committee reviewed and

assessed the quality and effectiveness of

the FY21 external audit process based on

evidence obtained throughout the financial

year by reference to the scope of the audit

work undertaken, monitoring performance

against the agreed audit plan, presentations

to the Committee, feedback from

management involved in the audit process

and separate review meetings held without

management. The Committee also

considered the experience and knowledge

of the external audit team and the results of

post-audit reviews with management and

the Committee. Overall, the Committee

remained satisfied with the effectiveness of

Deloitte based on its expertise considering

the audit team, their approach, lines of

enquiry and robust challenge. Following this

review, the Committee concluded that the

external audit was effective and was satisfied

with the level of services provided by

Deloitte.

The Committee regularly meets with the

external auditor absent management to

discuss any issues the external auditor may

wish to raise directly with the Committee.

Independence

In assessing the independence of the

external auditor, the Committee takes into

account the information and assurances

provided by the external auditor confirming

that its engagement team and its network

firms involved in the audit are independent of

any links with the Company.

In May 2022, the external auditor’s Letter of

Engagement was reviewed by the

Committee on behalf of the Group in

advance of the commencement of the audit.

The Letter of Engagement sets out

confirmation of Deloitte’s independence

within the meaning of the regulations and

professional standards.

The Committee has two separate policies

in place in order to safeguard the external

auditor’s independence and objectivity.

One policy sets out comprehensive

procedures surrounding the provision of

non-audit services by the external auditor.

The procedures are also set out in the

Committee’s Terms of Reference. In line with

that policy, the Committee reviewed the

level of fees incurred during FY22 for the

provision of non-audit services. During FY22,

Deloitte provided limited sustainability

assurance services on green loan KPI targets

which equated to c.3% of the overall external

audit fee. No further non-audit services were

provided by Deloitte. See Note 4 to the

Group Financial Statements.

The second policy restricts the hiring of any

former employee of the external auditor for

a period of two years post their employment

with the external auditor, without prior

approval of the Committee. Both policies

82 Greencore Group plc Annual Report and Financial Statements 2022

Report of the Audit and Risk Committee continued

are circulated to management regularly and

reviewed by the Committee on an annual

basis. These policies were reviewed in

FY22 and no amendments were made.

No former employees of Deloitte were

hired during FY22.

On the basis of the above, the Committee is

satisfied as to the external auditor’s

effectiveness, independence and objectivity,

and, accordingly, it is intended that an

advisory resolution will be put to the

shareholders at the forthcoming Annual

General Meeting in relation to the

continuation in office of Deloitte as external

auditor.

Committee effectiveness

As noted on page 71, Independent Audit

Limited (‘Independent Audit’), an external

consultancy firm was engaged to conduct

the FY21 annual evaluation of the Board and

Board Committees which was completed in

January 2022. The FY22 review of the

operation, performance and effectiveness of

the Committee was conducted using an

online questionnaire via Independent Audit’s

‘Thinking Board Evaluator’ portal and a

performance evaluation discussion was

included on the agenda for the Committee

at its September 2022 meeting, supported by

an analysis of how the Committee was

performing against key areas of its Terms of

Reference. Both reviews confirmed that the

Committee continues to operate effectively

and efficiently and has the skills and

expertise required in order to perform its role

appropriately. The Committee supported the

continued focus on risk matters on the

Committee agenda for FY23.

I would like to extend my thanks to my

Committee colleagues for their work and

support during the year. The Committee will

continue to be dedicated to providing

meaningful disclosures on the Committee’s

activities. As this is my last year as Chair of

the Committee, I would like to thank all my

fellow Committee members for their hard

work and commitment during my tenure.

Helen Weir

On behalf of the Audit and Risk Committee

28 November 2022

83Strategic Report | Directors’ Report | Financial Statements

Report on Directors’ Remuneration

Dear Shareholder,

On behalf of my colleagues on the

Remuneration Committee (the ‘Committee’)

and the Board, it is my pleasure to present

the Committee’s Report on Directors’

Remuneration (‘Report’) which comprises

the Annual Report on Remuneration for the

financial year ended 30 September 2022

(‘FY22’) and the proposed 2023

Remuneration Policy.

I wish to start this Report by acknowledging

and responding to the outcome of the vote

on the resolution to approve the FY21 Annual

Report on Remuneration at the 2022 Annual

General Meeting (‘AGM’). Whilst the advisory

resolution was passed, a significant number

of shareholders did not support the

resolution (with c.46% of shareholders voting

against). Through extensive engagement

both prior to and following the 2022 AGM,

the Committee understands that this

disappointing outcome related primarily to

the decisions taken by the Committee in

relation to FY21 remuneration: the one-off

tailored structure of the FY21 Performance

Share Plan (‘PSP’) award, and the structure

and payment of bonus for FY21 in particular.

The Committee is grateful for the input and

insights received from shareholders and the

open dialogue it has been able to have

during this challenging period; and I hope

that we have been able to explain clearly

below the process and rationale for the

decisions taken in relation not only to FY21,

but also remuneration in FY22 and beyond, as

a result of the feedback received.

The departure from our usual approach to

remuneration for FY21 reflected the very

exceptional circumstances and challenges

facing the business at the time. The

Committee sought to develop a framework

for the annual bonus and PSP for FY21 that

reinforced the delivery of the strategy and

shareholder value, in what was and remains a

very uncertain and constantly changing

external environment. In doing so, the

Committee determined that a one-off

departure from our usual practices would

more closely align the interests of our

Executive Directors with key stakeholders –

including our employees and shareholders

– and protect the Group. The Committee

recognises that aspects of this tailored

incentive design for FY21 – while cascaded

on a consistent basis to other eligible bonus

and PSP participants to ensure alignment

internally – were not in line with some of the

incentive design principles generally

expected by shareholders. Through prior

consultation with our largest shareholders,

the Committee sought to address proactively

the feedback and views received. We

implemented a number of safeguards to

ensure that the actions taken in FY21 would

only deliver reward if outcomes were aligned

with the longer term stakeholder experience,

including 100% deferral of any bonus payout

into shares for three years, and extending the

holding period applying to any shares vesting

from the FY21 PSP such that the total time

horizon for all three tranches was five years.

We also reduced, at the time of grant, the

award opportunity of the FY21 PSP to

mitigate the potential risk of windfall gains as

a result of the prevailing share price at the

time of grant. The Committee also

reinforced the availability to it of market

standard discretionary powers to override

the formulaic outcome of the FY21 PSP ex

post to ensure continued alignment of

executive reward with the underlying

performance of the Group. Reflecting

alignment with the share price, Tranche 1 of

the FY21 PSP lapsed in FY22 and Tranche 2 is

expected to lapse in January 2023, which

cumulatively amount to 40% of the total

FY21 PSP award opportunity.

During the period of consultation after the

2022 AGM (in which we contacted

shareholders representing 83% of the

provided feedback flagged the exceptional

nature of FY21 remuneration as the reason

for their decision not to support the

resolution to approve the FY21 Annual

Report on Remuneration; notwithstanding

their comfort with reverting to prior (and

more conventional) practices for FY22. The

Committee recognises the strength of

feeling around the departure from normal

remuneration practices for FY21 and, in

response, we propose to maintain the

structure for FY22 outlined in this Report

under the new Policy, for FY23, which was

our structure prior to the exceptional

circumstances we faced in FY21.

A number of shareholders also expressed

concerns about package quantum. The

Committee has taken this feedback on board

in setting the packages agreed for the new

Chief Executive Officer and Chair Designate,

whose packages have both been set to

reflect the size and geographic reach of the

Greencore business today. Further details on

these packages are set out in this Report, and

the Committee remains committed to

keeping these under review to ensure they

remain appropriately competitive – without

being excessive – and in line with our stated

remuneration principles.

2023 Remuneration Policy

The AGM in January 2023 marks the third

anniversary of the adoption of the current

2020 Remuneration Policy (the ‘Current

Policy’), and we will be submitting the

proposed 2023 Remuneration Policy (the

‘Revised Policy’) (collectively the ‘Policies’) to

shareholders for an advisory vote at the

forthcoming AGM.

“The Committee reviewed the Remuneration

Policy during FY22 to ensure it remains

fit-for-purpose in the context of Greencore

today. We have taken into account the

feedback of stakeholders while ensuring

our approach continues to reflect our

remuneration principles, incentivise delivery

of our strategy, and align executive reward

with the experience of key stakeholders; in

particular our shareholders and colleagues.”

84 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

During the year, the Committee reviewed the

Current Policy to ensure that it continues to

support delivery of the strategy and reflects

governance good practice. The Committee

believes that the Current Policy remains fit

for purpose and only minor changes are

being proposed:

• We have simplified the policy on

pensions, reflecting that the contribution

rate for incumbent directors is now fully

aligned with the rate applicable to the

wider colleague base;

• Following the recent Board changes, the

Committee determined that the notice

period required from future Executive

Director appointments (including Dalton

Philips) should be extended to six months

from three, and that from the Company

to 12 months from 11 months (in line with

typical market practice); and

• To provide a suitable level of flexibility for

annual bonus design going forward, the

Revised Policy allows for up to 25% of

maximum to be payable for threshold

performance. This is intended to give the

Committee the flexibility to set threshold

performance at an appropriate level for

the business context through the term of

the Revised Policy and set the payout

accordingly. This flexibility will not be

used for the FY23 cycle.

Alongside the renewal of the Policy at the

AGM in January 2023, we will be seeking

shareholder approval for the 2023

Performance Share Plan (‘PSP’) Rules. The

Rules of our current PSP were last adopted

by shareholders in 2013 and authority to

grant awards under the plan will expire on

the tenth anniversary of that adoption date.

It is therefore intended that a new PSP (the

Rules of which are consistent with the rules

of the existing plan – including maximum

award levels and dilution limits – and reflect

updates in generally-accepted good practice

since 2013), will be put to shareholders at the

2023 AGM.

To assist with the recruitment and retention of

employees below the Executive Director level,

we are also seeking shareholder approval for

a Restricted Share Plan, to enable awards to

be settled via new issue shares (subject to

appropriate dilution limits). This will provide

the Committee with greater flexibility to

structure share awards for the wider

colleague base which are competitive – but

not excessive – in relevant talent markets.

Executive Directors will not be entitled to

participate in the Restricted Share Plan.

Following engagement, the Committee

received a favourable response from

shareholders for the proposed Revised

Policy. Reflecting comments received, we

have sought to strengthen the disclosure

provided in the Annual Report on

Remuneration to ensure that it continues

to meet the expectations of our external

stakeholders. In particular, we have improved

the disclosure around the personal and

strategic objectives used in the Annual Bonus

Plan (‘ABP’). Our sustainability strategy is a

core part of our overall strategy, and

reflecting the importance of this to our

stakeholders, we have already embedded

specific objectives around this into the

strategic objectives in the ABP and we will

continue to assess how we reflect them in

our incentive arrangements (both short and

long-term) for future award cycles during the

life of the Revised Policy.

Board changes during the year

As reported last year, Patrick Coveney,

Executive Director and Chief Executive

Officer (‘CEO’) resigned from the Group with

effect from 30 March 2022. In line with our

Policies, and given his decision to terminate

his contract, he did not receive any bonus for

FY21 (either in cash or deferred shares). He

was not eligible to participate in the FY22

ABP or receive an award under the FY22 PSP.

All outstanding PSP and deferred share

awards lapsed upon his departure. There

were no payments in lieu of notice and he

remains subject to the post-employment

shareholding guideline.

Following Patrick’s resignation on 30 March

2022, and in line with the Board’s

contingency plan, Gary Kennedy was

appointed Executive Chair on 31 March 2022

and remained in that role until the

appointment of Dalton Philips as Executive

Director and CEO. Gary received an

additional fee (€32,000 per month) for that

period whilst performing executive duties.

Prior to that, for the period from 1 December

2021 until 30 March 2022, Gary received an

exertion fee of €32,000 per month to

recognise the significant increase in the time

commitment arising from him assuming a

more active role in the business and through

a period of leadership transition. Gary was

not eligible to participate in the ABP or PSP.

Gary stepped down as Executive Chair on

the appointment of Dalton Philips and will

retire as Board Chair and Non-Executive

Director at the conclusion of the 2023 AGM.

Leslie Van de Walle will join Greencore as

Non-Executive Director and Chair Designate

on 1 December 2022 and assume the Board

Chair role from the end of the 2023 AGM.

Dalton Philips joined the Board as Executive

Director and CEO on 26 September 2022

on an annual salary of €700,000. Dalton is

eligible to receive a pension contribution of

8% of salary, which is in line with the pension

contribution currently available to the wider

colleague base. Due to the point in the year

at which he joined, Dalton did not receive

1. The Group uses Alternative Performance Measures (‘APMs’) which are non-IFRS measures to monitor the performance of its operations and of the Group as a whole.

These APMs along with their definitions and reconciliations are provided in the APMs section from page 179.

FY22 business performance

Performance highlights include:

• Group Revenue up 31.3% to £1.7bn, driven by strong growth

in food to go and other convenience categories

• Pro Forma Revenue Growth in food to go categories increased

by 35.2% year on year, driven by a combination of strong

underlying volume growth, contribution from new wins,

and increased pricing as we pass through inflation

• Significant growth in Adjusted Operating Profit which is

up £33.2m to £72.2m from £39.0m in FY21, with Adjusted

Operating Margin of 4.2% (FY21: 2.9%) and H2 22 margin

of 5.7% (H2 21: 5.2%)

• Adjusted EPS of 9.2p is 5.5p ahead of FY21

• Strong cash conversion of 46.3% resulting in Net Debt

(excluding lease liabilities) of £180.0m (2021: £183.1m)

at year end after £33.1m of strategic capex and completion of

£8.8m of the £10.0m share buyback

• Strong balance sheet with substantial liquidity headroom

and continued progress on deleveraging. Net Debt: EBITDA

of 1.5x as measured under financing agreements now reaching

the Group’s target range of 1.0x–1.5x. Committed facilities

of £578m

• Completed £10m share buyback programme in early October

which is the first phase of the £50m value return to

shareholders announced in May 2022

85Strategic Report | Directors’ Report | Financial Statements

any variable compensation for FY22. For

FY23, he will be eligible to receive a

performance related bonus of up to 150% of

salary and a FY23 PSP award with a face

value of 175% of salary (within the Policy

maximum of 200% of salary). Dalton’s

remuneration package was set in the context

of his experience and valued expertise in the

grocery sector, but also reflecting the size

and geographic reach of Greencore today.

Annual Bonus Plan (‘ABP’)

The FY22 ABP was based 50% on Adjusted

Operating Profit (‘AOP’), 25% on Free Cash

Flow (‘FCF’) and 25% on personal and

strategic objectives. Despite the increasingly

challenging operating environment of FY22,

the Company delivered a resilient AOP

outturn incrementally above the threshold

set at the start of the year. FCF performance

was strong, and exceeded the maximum

performance level set at the start of the year.

Taking into account the strong achievement

by the CFO of many of the personal and

strategic objectives set for FY22 (but also

reflecting that some of the sustainability

objectives were not met in full), the

Committee assessed the overall ABP payout

for Emma Hynes to be 46.25% of maximum.

Further details are set out on pages 99

to 101.

Performance Share Plan (‘PSP’)

The FY20 PSP award is based 1/3rd on

Adjusted EPS growth, 1/3rd on ROIC and

1/3rd on relative TSR performance

conditions measured over the period of

three financial years ended 30 September

2022. Notwithstanding the Group’s resilient

performance over the performance period,

the performance targets, set before the

onset of the COVID-19 pandemic and the

downturn in the Group’s operating

environment (and external market conditions

more generally), were not met and awards

will lapse in full.

The first tranche (i.e. 15%) of the FY21 PSP

lapsed in full in FY22. The second tranche is

still in flight at the date of this Report, but its

performance period is substantially

completed. Based on performance to the

date of signing this Report, this second

tranche of the award (i.e.25%) is also

expected to lapse in full.

Remuneration in FY23

The Committee’s decisions in relation to

Executive Director remuneration for FY23

were informed as much by the broader

context as our internal pay policies and

practices. As in previous years, the

Committee reviewed in detail the

stakeholder experience, in particular this year

the actions taken by management to support

our wider colleague base through the

prevailing inflationary environment and

ongoing cost-of-living pressures. These

actions included:

• focusing a higher proportion of the

available pay review budget on our lowest

paid colleagues. Lower paid colleagues

received an average increase of around

6% for FY23, taking into account the

compression of pay resulting from higher

National Living Wage (NLW) increases

over recent years in the direct and indirect

workforce. The median increase awarded

across the professional and managerial

population (including exceptional and

internal equity adjustments) was c.4.8%.

Restraint has been demonstrated at more

senior levels to enable these decisions to

be implemented in an affordable manner;

and

• extending a wide range of other support

measures, including free tea and coffee

for all colleagues, vouchers, and offering

our colleagues the opportunity to

purchase our own products at nominal

prices.

Noting the prudence of actions taken, and

the desire to extend these principles fairly to

the Executive Directors, the Committee

agreed that it would be appropriate to award

a 3% salary increase to Emma Hynes, the first

increase since she was appointed Chief

Financial Officer (‘CFO’) in 2020. Dalton

Philips’ salary was set on appointment and

remains unchanged for FY23.

The ABP opportunity will be 150% of salary

for both Executive Directors. The financial

element of the ABP (75% of the opportunity)

will remain a combination of Adjusted

Operating Profit (weighted 50%) and Free

Cash Flow (25%), with the remaining 25% of

the opportunity linked to personal and

strategic objectives. For FY23, this element

will continue to include objectives linked to

our sustainability strategy. Performance for

each element will be measured over the full

year. The targets and the associated outturn

will be disclosed in the FY23 Annual Report

on Remuneration, in line with prior practice.

The FY23 PSP opportunity for the CEO is

175% of salary and for the CFO is 150% of

salary (within the Policy maximum of 200%

of salary), with vesting based on

performance over the three-year

performance period against three equally

weighted measures. The measures will

remain unchanged from those employed for

the FY22 awards: Adjusted Earnings per

Share (‘Adjusted EPS’), relative TSR (against

our tailored comparator group), and Return

on Invested Capital (‘ROIC’). At the time of

publishing this Report, the performance

targets in relation to the EPS and ROIC

elements of the FY23 PSP have not been

finalised and will be disclosed in the RNS

announcement at the time of grant, which is

anticipated to be in December 2022. The

Relative TSR performance condition is

unchanged from the FY22 PSP cycle.

Concluding remarks

I would like to thank shareholders and proxy

advisors for providing both their time and

input during the year, and also thank my

fellow members on the Committee and the

wider Board for their valuable contribution to

the remuneration agenda during FY22.

We believe that our approach to

remuneration in FY22 and for FY23 supports

the objective of driving the Group’s

performance while recognising the wider

stakeholder experience and I hope our

efforts will be reflected in your support at the

2023 AGM. I remain available to meet and

discuss our remuneration arrangements with

shareholders outside of the AGM and I look

forward to continuing to engage with

shareholders on all future remuneration

matters.

Linda Hickey

On behalf of the Remuneration Committee

28 November 2022

86 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

The Directors’ Remuneration Policy (the ‘2023 Remuneration Policy’) set out below will be put to an advisory shareholder vote and, subject

to shareholder approval, will become effective from the date of the AGM in 2023. The main aim of the 2023 Remuneration Policy is to

align the interests of Executive Directors with the Group’s strategic priorities and the long term creation of shareholder value. The 2023

Remuneration Policy is intended to pay the Executive Directors competitively and appropriately – without being excessive. When setting the

2023 Remuneration Policy (and determining the approach to its implementation for the Executive Directors), the Remuneration Committee

(the ‘Committee’) took into account a number of factors, including the business strategy, remuneration practices of other companies of

similar size and scope, the stakeholder context (in particular remuneration practices throughout the Group), and the regulatory and

governance framework.

Remuneration principles

The following principles and Provision 40 pillars of the 2018 UK Corporate Governance Code (the ‘Code’) remain the Committee’s framework

to guide remuneration decisions:

Principle / Provision 40 pillar(s) In action

Alignment and fairness

– alignment to culture

• Enabling all employees to become shareholders;

• Operating a Performance Share Plan (‘PSP’) for senior management personnel;

• To the extent possible, offering share plans to all eligible colleagues;

• Operating shareholding guidelines (including for a period post-employment), bonus deferral and a

post-vesting holding period for Executive Directors’ PSP awards; and;

• Keeping shareholder value creation and the stakeholder context in sharp focus.

Pay-for-performance

– risk

– predictability

– proportionality

• Linking variable remuneration to key pillars of success for Greencore;

• Setting targets that are appropriately stretching and vesting levels that are reflective of the shareholder

experience;

• Avoiding reward for mediocre performance; and

• Ensuring personal and strategic objectives are defined, accurately assessed and clearly communicated.

Transparency and simplicity

– clarity

– simplicity

• Communicating clearly and effectively all decisions to shareholders through shareholder engagement

and the Annual Report and Financial Statements; and

• Using a simple incentive structure based on measures that are central to our strategy and business model.

Executive Directors’ Remuneration Policy table

The table below sets out the elements and purpose of Executive Directors’ remuneration and how each element operates, as well as the

maximum opportunity of each element and any applicable performance measures. The 2023 Remuneration Policy set out in this Report is

largely unchanged from that approved by shareholders in 2020, save as explained in further detail in the introductory letter from the

Remuneration Committee Chair at the front of the Report on Directors’ Remuneration.

Element of

remuneration Purpose and link to strategy Operation Maximum opportunity Performance measures

Base salary

To provide the basis of

a market-competitive

overall remuneration

package.

Base salaries are determined taking into

account a number of factors, including:

• individual responsibilities, performance

and experience;

• the role, skills and contribution of

individuals;

• practice at other companies of a similar

size and complexity;

• the pay arrangements throughout the

organisation; and

• the Company’s progress towards its

objectives.

Salaries are usually reviewed during

November of each year and any increases will

normally be effective from the preceding

1 October. However, the Committee reserves

the right to make salary increases effective

from any other time where considered

appropriate.

Whilst there is no maximum

salary, increases will normally

be in line with the average

increase awarded to other

colleagues in the Group.

However, the Committee

retains the discretion to

make increases above this

level in certain

circumstances, including,

but not limited to:

• an increase in scope

and/or responsibility of a

role;

• a new Executive Director

being moved to

market-competitive

positioning over time;

and

• an existing Executive

Director falling below

the appropriately

competitive market

positioning.

Not applicable.

2023 Remuneration Policy

87Strategic Report | Directors’ Report | Financial Statements

Element of

remuneration Purpose and link to strategy Operation Maximum opportunity Performance measures

Pension

To provide competitive

and appropriate

retirement plans.

Executive Directors are able to participate in a

defined contribution pension scheme, as is

available to the majority of the Group’s

workforce in the relevant market and/or

receive a non-pensionable cash allowance.

The Company’s maximum

contribution / cash

allowance for Executive

Directors is in line with the

pension contributions

available to the majority of

the Group’s workforce. This

is currently 8% of salary.

Not applicable.

Benefits

To provide market

typical benefits to

ensure that the overall

remuneration package

is competitive.

Executive Directors are eligible to receive

benefits, including but not limited to, health

insurance for the individual and their

immediate family (or an agreed allowance

with which to arrange cover personally), life

assurance and permanent health insurance,

and a car allowance (or a company car and

payment of related expenses).

Other benefits may be provided at the

discretion of the Committee based on

individual circumstances and business

requirements, such as appropriate relocation

and expatriate allowances and support.

The cost of benefit

provision will depend on the

cost to the Company of

providing individual items

and the individual’s

circumstances and

therefore there is no

maximum value.

Not applicable.

Annual Bonus

Plan (‘ABP’)

To incentivise and

reward the

achievement of annual

financial and non-

financial targets, in line

with the Company’s

strategic objectives.

The deferred element

aligns the interests of

Executive Directors and

shareholders and

provides a strong

retention mechanism.

Performance is assessed over the relevant

financial year.

The level of payment is determined by the

Committee after the year-end, based on

performance against targets and any

additional factors it deems significant.

A proportion (normally 50% unless the

Committee determines otherwise) of any

bonus is paid in cash, with the remainder

deferred into a share award under the

Deferred Bonus Plan. Cash bonuses are paid

following the year-end.

Deferred Bonus Plan (‘DBP’)

The deferred shares will normally vest three

years after the grant of an award (unless the

Committee determines an alternative vesting

period is appropriate).

The vesting of deferred shares will normally

be subject to continued employment.

Dividend equivalents may be awarded in

respect of the awards that vest.

The annual bonus is subject to malus and

clawback provisions, i.e. forfeiture or

reduction of the deferred portion or recovery

of paid amounts, in exceptional

circumstances. Such circumstances include,

but are not limited to, serious misconduct, a

material misstatement of the Company’s

audited results, a material failure of risk

management, a material breach of health and

safety regulations or serious reputational

damage to any member of the Group.

The maximum annual

bonus opportunity is 150%

of salary.

The bonus earned at

threshold performance is nil

(unless the Committee

determines an alternative

payout level, of up to 25% of

the award, is appropriate)

with up to 50% of the award

normally payable for target

performance. 100% of the

award is payable for

maximum performance.

The bonus is

determined based

on financial

performance metrics

and personal and

strategic objectives.

Measures and

weightings will be

determined at the

start of each

performance year to

align with the

Group’s short term

financial and

strategic priorities.

No more than 25% of

the annual bonus

opportunity will be

based on personal

and strategic

objectives.

The Committee sets

targets every year to

ensure that they are

appropriately

stretching.

Further details,

including targets

attached to the

annual bonus for the

year under review,

are provided in the

Annual Report on

Remuneration.

88 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

2023 Remuneration Policy continued

Element of

remuneration Purpose and link to strategy Operation Maximum opportunity Performance measures

Performance

Share Plan

(‘PSP’)

To create alignment

between the interests

of Executive Directors

and shareholders

through the delivery of

rewards in Company

shares.

To incentivise Executive

Directors to deliver

long term shareholder

value creation and the

achievement of targets

aligned to the success

of the strategy.

Awards of conditional shares, nil-cost

options, or forfeitable shares are made

annually, with vesting dependent on the

achievement of performance conditions.

Awards normally vest based on performance

measured over a period of three years or

such other period as the Committee may

determine.

The Committee determines the extent to

which the performance measures have been

met. In adjudicating the final vesting

outcome, the Committee will also consider

the underlying business performance, as well

as the value created for shareholders. The

formulaic vesting outcome may be adjusted

where, in the Committee’s opinion, an

adjustment is warranted.

An additional two year holding period applies

to Executive Directors’ vested shares before

they are released to Executive Directors on

the fifth anniversary of the grant date (or

another date determined by the Committee).

In respect of vested PSP awards that are still

subject to a holding period, awards will

normally be released at the end of the

holding period. However, the Committee has

discretion to determine otherwise, taking into

account the circumstances at the time.

Dividend equivalents may be awarded in

respect of the awards that vest.

PSP awards are subject to malus and

clawback, i.e. forfeiture or reduction of

unvested awards, application of additional

conditions for vesting, or recovery of vested

awards, in exceptional circumstances. Such

circumstances include, but are not limited to,

serious misconduct, a material misstatement

of the Company’s audited results, a material

failure of risk management, a material breach

of health and safety regulations, or serious

reputational damage to any member of the

Group.

The maximum annual

award level is 200% of

salary.

For threshold levels of

performance, up to 25% of

the award vests, increasing

to 100% of the award for

maximum performance.

There is straight-line vesting

between these points.

Performance

measures are

selected to align with

the Group’s longer

term strategy.

The Committee

determines targets

for each cycle to

ensure that they are

appropriately

stretching and

represent value

creation for

shareholders, whilst

remaining

motivational for

management.

Further details,

including the targets

attached to awards

in respect of each

year, are provided in

the Annual Report

on Remuneration.

All Employee

Share Plans

To the extent possible,

enable eligible

employees to become

shareholders in

Greencore.

To the extent possible, the Executive

Directors are eligible to participate in any

tax-authority approved, all-employee share

plans offered by the Company on consistent

terms as other eligible employees in the

relevant jurisdiction.

In addition to existing employee share

plans (and other share plans applicable to

employees) of the Group, the Board may

introduce other employee share plans

from time to time in accordance with

applicable law.

To the extent possible,

Executive Directors are

eligible to participate on the

same terms as offered to

other eligible employees;

subject to the limits set out

in the relevant Irish or UK

tax legislation and/or

revenue rules.

Not applicable.

89Strategic Report | Directors’ Report | Financial Statements

Executive Director shareholding guidelines and policy

The Committee continues to recognise the importance of Executive Directors aligning their interests with shareholders through building up

a significant shareholding in the Company. Shareholding guidelines are in place whereby all Executive Directors are required, under normal

circumstances, to acquire a holding of shares in the Company equal to 200% of salary, typically over a five year period commencing on the

date of their appointment to the Board. Details of the Executive Directors’ current shareholdings are provided in the Annual Report on

Remuneration.

With effect from 2020, Executive Directors are also subject to a post-employment shareholding policy and will normally be expected to

maintain a holding of Greencore shares at a level equal to the lower of the in-post shareholding guideline or the individual’s actual

shareholding for a period of two years from the date the individual ceases to be a Director. For the purpose of this post-employment

shareholding policy, the following shares shall count towards the shareholding: vested DBP shares, unvested DBP shares (carried at an

assumed net of tax number) and vested PSP shares (including those subject to a holding period). For the avoidance of doubt, any shares

purchased by an Executive Director in the open market shall be excluded from this shareholding requirement.

The specific application of this shareholding policy will be at the Committee’s discretion.

Payments from previously agreed remuneration arrangements

The Committee reserves the right to make any remuneration payments and payments for loss of office (including the exercise of any

discretion available to it in connection with such payments), notwithstanding that they may not be in line with the 2023 Remuneration Policy,

but where the terms of the payment were agreed either before the 2023 Remuneration Policy came into effect or at a time when the relevant

individual was not a Director of the Company and in the opinion of the Committee, the payment was not in consideration for the individual

becoming a Director of the Company. This does not apply to pension contributions for new appointments to the Board, which will be aligned

with the pension contribution available to the majority of the Group’s workforce on appointment to the Board. Details of any such payments

will be set out in the Annual Report on Remuneration as they arise.

Discretion

The Committee may make non-material amendments to the 2023 Remuneration Policy (e.g. for regulatory, exchange control, tax or

administrative purposes or to take account of a change in legislation) without obtaining shareholder approval for that amendment.

The Committee has discretion to adjust the formulaic ABP and PSP vesting outcomes to ensure alignment of pay with performance, i.e. to

ensure the final outcome is a fair and true reflection of underlying business performance. The Committee also has discretion to vary the ABP

and PSP performance measures and weightings for each cycle, to reflect strategic priorities over the relevant performance period.

Awards granted under the ABP and the PSP:

• may be settled in cash;

• may incorporate the right to receive, in cash or shares, the value of dividends which would have been paid or allotted between grant and

vesting on the shares that vest. This may assume the reinvestment of those dividends in the Company’s shares on a cumulative basis; and

• may be adjusted in the event of a variation of the Company’s share capital or a demerger, delisting, special dividend, rights issue or other

event, which may, in the Committee’s opinion, affect the current or future value of awards. The Committee may amend or substitute

performance conditions applicable to an outstanding PSP award if an event (or events) occurs which causes the Committee to consider

that an amended or substituted performance condition would be more appropriate and would not be materially less difficult to satisfy than

was originally intended.

Selection of performance measures

The ABP is based on financial performance, as well as personal and strategic objectives. The financial element is currently based on Adjusted

Operating Profit and Free Cash Flow. Adjusted Operating Profit and Free Cash Flow are both Group Key Performance Indicators (‘KPIs’)

creating direct alignment between incentives and delivery of the Group’s strategy. The achievement of key personal and strategic (i.e.

non-financial) objectives is also considered important to drive the performance of the business over the longer term.

The PSP is currently based on Adjusted EPS, ROIC and relative TSR. The earnings measure incentivises Executive Directors to grow earnings

for shareholders over the long term, whilst the return measure ensures that the growth is sustainable and in the long term interests of the

Company and its shareholders. Relative TSR provides additional shareholder alignment and incentivises our outperformance against

companies in our sector.

The current mix of annual and long term measures is discussed in further detail in the Annual Report on Remuneration. Targets are set taking

into account a number of factors including internal and external forecasts and market practice.

The Committee keeps the performance measures, weightings and targets of both the ABP and PSP under review and reserves the right to

adjust these if they are no longer considered to be appropriate.

90 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

2023 Remuneration Policy continued

Remuneration arrangements throughout the Group

Remuneration arrangements throughout the Group are based on the same high-level remuneration principles as for the Executive Directors.

We believe that individuals should be rewarded based on their contribution to the Group and the success of the Group, and that reward

should be competitive in the market, without paying more than is necessary to recruit and retain individuals. Specific packages will differ,

taking into account the role, location, seniority and level of responsibility.

Senior management personnel participate in the ABP and the PSP based on broadly the same principles as those for the Executive Directors.

Other management personnel may be eligible to participate in share-based incentives to reflect competitive practice in relevant talent

markets, including structures not provided for in this Policy.

In addition, to the extent possible, eligible employees are entitled to join the Group’s all employee share plans (and other share plans

applicable to employees from time to time), which provide a means of saving and give employees the opportunity to become shareholders in

the Company.

Non-Executive Directors’ remuneration policy

The remuneration policy for the Non-Executive Directors, including the Chair, is to pay fees necessary to attract Non-Executive Directors of

the calibre required, taking into consideration the size and complexity of the business and the time commitment of the role, without paying

more than is appropriate.

Details of the 2023 Policy, which are unchanged from the 2020 Policy, are set out in the table below:

Element of remuneration Purpose and link to strategy Operation Maximum opportunity Performance measures

Fees

To attract and retain

Non-Executive

Directors of the highest

calibre with broad

commercial and other

experience relevant to

the Company.

Non-Executive Directors are paid a basic

fee for membership of the Board with

additional fees being paid for the role of

the Board Chair, the Senior Independent

Director or Chair of a Board Committee,

to take into account the additional

responsibilities and workload required. If a

Non-Executive Director is a Chair of more

than one Committee, the additional fee is

capped at the higher Committee fee. If a

Non-Executive Director is also the Senior

Independent Director, the fee is capped at

the additional Senior Independent Director

fee. Additional fees may also be paid for

other Board responsibilities or roles if this is

considered appropriate.

Fees are reviewed at appropriate intervals

and are set taking into account the level of

responsibility, relevant experience and

specialist knowledge of each Non-

Executive Director and fees at other

companies of a similar size and complexity.

Fees are normally paid in cash.

The maximum annual

aggregate basic fee for all

Non-Executive Directors is

currently €850,000, but,

subject to shareholder

approval, as required

under the Company’s

Articles of Association, this

figure may increase or

decrease.

Not applicable.

Incentive

arrangements

None of the Non-Executive Directors are

eligible to participate in any of the Group’s

incentive arrangements.

Not applicable. Not applicable.

Benefits

Non-Executive Directors do not currently

receive any benefits; however, benefits may

be provided in the future if, in the view of

the Board, this is considered appropriate.

Travel and other reasonable expenses

(including fees incurred in obtaining

professional advice in the furtherance of

their duties) incurred in the course of

performing their duties are reimbursed.

The Company may settle any tax due on

benefits or taxable expenses.

Not applicable. Not applicable.

91Strategic Report | Directors’ Report | Financial Statements

Remuneration policy for new hires

The Group is committed to ensuring appropriate succession plans are in place, specifically in respect of Executive Directors and other senior

management. When considering the remuneration package of a potential new Executive Director, the Committee would seek to apply the

following principles:

• The Committee will ensure that the package is sufficient to attract the appropriate individual, having regard to the calibre, skills and

experience required, whilst being cognisant of not paying more than is necessary.

• The Committee’s policy is to set the remuneration package for a new Executive Director in accordance with the approved remuneration

policy at the time of the appointment. The maximum aggregate opportunity under the ABP and PSP is limited to 350% of salary.

• In addition, where an individual forfeits outstanding incentive payments and/or contractual rights at a previous employer as a result of their

appointment at the Group, the Committee may offer additional compensatory payments or awards (‘buy-out’) in such form as it considers

appropriate. In doing so, it will take into account all relevant factors including the form of awards, expected value and vesting timeframe of

forfeited opportunities. When determining such buy-out arrangements, the Committee’s intention would be that awards would generally

be made on a ‘like for like’ basis as those forfeited. In order to facilitate any such buy-out awards, the Committee may exercise the

discretion available under the Listing Rules to grant awards under an alternative structure to those set out in the policy without seeking

prior shareholder approval.

• Where an Executive Director is required to relocate from their home location to take up their role, the Committee may provide reasonable

assistance with relocation in line with local market norms.

• In the event that an internal candidate is promoted to the Board, legacy terms and conditions (with the exception of pension entitlements,

which shall be aligned to those of the majority of the Group’s workforce) and any outstanding incentive awards will normally be honoured.

• The remuneration package for a newly appointed Non-Executive Director will normally be in line with the structure set out in the Non-

Executive Directors’ remuneration policy table on the previous page.

Remuneration opportunities in different performance scenarios

The charts below illustrate the potential future value and composition of the Executive Directors’ remuneration opportunities in four

performance scenarios: minimum, on-target (i.e. in line with the Company’s expectations), maximum, and maximum plus 50% share price

appreciation, a scenario where 50% share price appreciation is included.

The potential remuneration opportunities are based on the proposed application of the 2023 Remuneration Policy for the forthcoming

financial year (FY23), applied to the Executive Directors’ base salaries as at 1 October 2022.

Dalton Philips, CEO (€000) Emma Hynes, CFO (€000)

Minimum On-target Maximum Maximum+50%

€806

€1,637

€3,081

€3 ,694

1,000

500

1,500

2,000

2,500

3,500

3,000

4,000

100% 49%

19%

40%

50%

32%

34% 28%

26% 22%

€568

€1,119

€2,038

€2,406

Minimum On-target Maximum

Maximum+50%

500

1,000

1,500

2,000

2,500

3,000

16%

36%

46%

33%

36%

31%

100% 51% 28% 23%

Fixed remuneration Annual bonus Long-term incentive

The charts above exclude the effect of any Company share price appreciation except in the ‘maximum+50%’ scenario.

Assumptions:

Performance scenario Includes

Minimum

• Salary, pension and estimated benefits (‘fixed remuneration’)

• No bonus payout

• No vesting under the PSP

On-target

• Fixed remuneration

• 50% of maximum annual bonus payout (i.e. 75% of salary)

• 25% of maximum vesting under the PSP (i.e. 43.75% and 37.50% of salary for the CEO and CFO respectively)

Maximum

• Fixed remuneration

• 100% of maximum annual bonus payout (i.e. 150% of salary)

• 100% of maximum vesting under the PSP (i.e. 175% and 150% of salary for the CEO and CFO respectively)

Maximum+50%

• Fixed remuneration

• 100% of maximum annual bonus payout (i.e. 150% of salary)

• 100% of maximum vesting under the PSP, plus 50% share price appreciation

92 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

2023 Remuneration Policy continued

Executive Director service contracts

Dalton Philips was appointed as Chief Executive Officer (‘CEO’) with effect from 26 September 2022 and has a service contract dated 13 May

2022 with an indefinite term, which is terminable by either the Company or Dalton Philips on 12 and six months’ notice, respectively.

Emma Hynes was appointed as Chief Financial Officer (‘CFO’) with effect from 19 May 2020 and has a service contract dated 23 March 2020

with an indefinite term, which is terminable by either the Company or Emma Hynes on 11 and three months’ notice, respectively.

Policy on payments to Executive Directors leaving the Group

The Executive Directors’ service contracts make provision, at the Board’s discretion, for early termination involving payment of salary and

other emoluments in lieu of notice. When determining leaving arrangements for an Executive Director, the Committee takes into account any

contractual agreements including the provisions of any incentive arrangements, typical market practice and the performance and conduct of

the individual. The table below summarises how the awards under incentive plans are typically treated in specific circumstances, with the final

treatment remaining subject to the Committee’s discretion. When considering the use of discretion, the Committee reviews all potential

incentive outcomes to ensure that any application of discretion is fair both to shareholders and to participants.

Plan Scenario Timing and calculation of payment/vesting

Annual Bonus Plan (‘ABP’)

All leavers (except for reasons set out below) No bonus is paid and deferred share awards will lapse.

Death The Committee may determine that an Executive Director is

eligible to receive a bonus for the year.

The Committee will determine the level of bonus taking into

account performance.

Outstanding deferred share awards will vest in full – or to a

lesser extent as determined by the Committee – on the

normal vesting date, although the Committee has discretion

to accelerate vesting.

Ill-health, injury, disability, redundancy,

retirement, the sale or transfer of their

employing entity out of the Group, or any

other reason at the Committee’s absolute

discretion (‘Good Leaver’)

Change of control The Committee will assess the most appropriate treatment for

the outstanding bonus period according to the

circumstances. Deferred share awards will vest in full.

Performance Share Plan

(‘PSP’)

All leavers (except for reasons set out below) Awards lapse

Death Awards will vest immediately to the extent determined by the

Committee, taking into account the extent to which the

performance conditions have been met and, if the Committee

so determines, the period of time elapsed since grant.

Ill-health, injury, disability, redundancy,

retirement, the sale or transfer of their

employing entity out of the Group, or any

other reason at the Committee’s absolute

discretion (‘Good Leaver’)

Awards will vest on the original vesting date, or, if the

Committee so determines, as soon as practicable after the

date of cessation. The extent to which awards vest in these

circumstances will be determined by the Committee, taking

into account the extent to which the performance conditions

have been satisfied, and, unless the Committee determines

otherwise, the period of time from the date of grant up to the

date of cessation.

Change of control Awards vest immediately, subject to performance, and will be

pro-rated for time (based on the proportion of the vesting

period elapsed) unless the Committee determines otherwise.

Alternatively, awards may be exchanged for new equivalent

awards in the acquirer where appropriate.

In respect of vested PSP awards that are still subject to a holding period, awards will normally be released at the end of the holding period.

However, the Committee has discretion to determine otherwise, taking into account the circumstances at the time.

Change of control

The CFO’s Letter of Appointment (‘Contract’) provides that, in the event of a change of control of the Company, she is entitled to terminate her

employment with the Company with 30 days’ prior notice at any time within six months after the change in control if she has reasonable

grounds to contend that the change in control has resulted, or will result, in the diminution of her powers, duties or functions in relation to the

Group. If her contract is terminated in the event of the change of control, she can seek a payment from the Company in settlement of all and

any claims arising in those circumstances. The amount of the payment (subject to deduction of income tax) will be equal to the sum total of

her basic salary, the bonus paid to the Executive Director in the calendar year immediately preceding such termination and any retained bonus

approved but unpaid for the year immediately prior to the year in which the Executive Director’s contract was terminated. Reflecting current

practice, the CEO’s contract does not have a similar provision.

93Strategic Report | Directors’ Report | Financial Statements

Treatment of incentives on a change of control is set out in the table on page 92. In the event of a merger, demerger, delisting, special

dividend or other event which may, in the opinion of the Committee, affect the current or future value of the Company’s shares, the

Committee may allow DBP and PSP awards to vest on the same basis as for a change of control.

Non-Executive Director letters of appointment

The Non-Executive Directors have Letters of Appointment, the terms of which recognise that their appointments are subject to the

Company’s Articles of Association and their services are at the direction of the shareholders.

All Non-Executive Directors submit themselves for election at the AGM following their appointment and, in line with the Company’s Articles of

Association and the Code, each Director retires at each subsequent AGM and offers him or herself for re-election as appropriate.

Non-Executive Directors are not entitled to any payment in lieu of notice. The Letters of Appointment are available for shareholders to view at

the AGM and at the Company’s registered office during normal office hours.

The table below shows the appointment and expiry dates for the Non-Executive Directors:

Name Effective date of appointment Expiry of appointment

John Amaechi 1 February 2021 26 January 2023

Sly Bailey 17 May 2013 26 January 2023

Paul Drechsler 1 May 2020 26 January 2023

Linda Hickey 1 February 2021 26 January 2023

Gary Kennedy 20 November 2008 26 January 2023

Anne O’Leary 1 February 2021 26 January 2023

Helen Rose 11 April 2018 26 January 2023

Helen Weir

1 February 2020 31 December 2022

1. Helen Weir will step down as Non-Executive Director on 31 December 2022.

Development and application of the Remuneration Policy

The Committee receives independent advice from its independent remuneration advisors, with independently sourced data to assist the

Committee in setting and applying the Remuneration Policy. The CEO, CFO and Chief People Officer attend meetings upon invitation. The

Committee was mindful of managing any conflicts of interest in preparing the 2023 Remuneration Policy and no individual was involved in

determining his/her own arrangements.

Consideration of wider employee views

The Committee considers pay and employment conditions elsewhere in the Group when determining pay for Executive Directors. The Chief

People Officer makes regular presentations to the Committee on the remuneration structures for both weekly paid and salaried colleagues,

the salary review process for the wider colleague base as well as benefit and pension arrangements.

In considering increases to the base salary for Executive Directors, the Committee takes the Group-wide annual salary review process into

account.

The Board recognises the value of listening to colleagues’ views and perspectives on a range of business matters, and has established multiple

channels to ensure effective two-way engagement with our wider colleague base. These include the role of our Workforce Engagement

Director, who has been designated responsibility for engaging with colleagues and bringing their voice into the boardroom. We have also

established a number of colleague listening groups and recently set up further local colleague forums and a cross functional colleague forum.

These forums meet with the Chief People Officer on a regular basis and during 2022, the cross functional colleague forum was attended by

Linda Hickey, our Remuneration Committee Chair, who presented on Greencore’s remuneration philosophy and principles, as well as the

proposed updates to the executive remuneration policy and participated in a question and answer session. Colleagues attending that session

welcomed the open and transparent disclosure. This feedback was relayed to the Remuneration Committee and taken into account – along

with the feedback from engagement with our shareholders – when finalising the policy proposals being tabled for shareholder approval at the

2023 AGM.

In addition, employees are encouraged to become shareholders under the Company’s all employee share plans and once an employee

becomes a shareholder, he or she can vote on resolutions in respect of Directors’ remuneration (including the advisory shareholder vote on

the Group’s remuneration policy at least every four years or earlier if there is a proposed material change to the approved policy) along with

any other resolutions put before the AGM.

94 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

2023 Remuneration Policy continued

Consulting with our shareholders

The Committee is dedicated to ensuring open dialogue with shareholders in relation to remuneration. In advance of any proposal to amend

the Group’s remuneration policy (excluding any non-material changes), the Committee, led by the Committee Chair, will liaise with key

shareholders and proxy advisory firms to discuss the proposed amendments and receive their feedback on these amendments to factor into

the Committee’s decision making. During the year, the Committee Chair engaged with shareholders on the voting outcome at the 2022 AGM

and the proposed 2023 Remuneration Policy and communications were issued to shareholders holding approximately 83% of the Company’s

issued share capital. Consultations were held with shareholders representing c.22% of issued share capital. The Committee welcomed the

feedback received through this process and the indications of broad support for the proposed 2023 Remuneration Policy that is now being

put to a shareholder vote at the AGM.

The sections of this 2023 Remuneration Policy entitled (a) Remuneration principles; (b) Executive Directors’ Remuneration Policy table; (c)

Discretion; (d) Selection of performance measures; (e) Non-Executive Directors’ remuneration policy; (f) Remuneration policy for new hires;

(g) Remuneration opportunities in different performance scenarios; (h) Executive Director service contracts; (i) Policy on payments to

Executive Directors leaving the Group; (j) Change of control; (k) Non-Executive Director letters of appointment; (l) Development and

application of the Remuneration Policy; (m) Consideration of wider employee views; and (n) Consulting with our shareholders, relate to the

remuneration of the directors of Greencore for the purposes of Section 1110M of the Companies Act 2014 with which the Group complies on

a voluntary basis.

95Strategic Report | Directors’ Report | Financial Statements

The Company is putting the 2023 Remuneration Policy to an advisory shareholder vote at the AGM of the Company to be held on 26 January

2023. If approved, the 2023 Remuneration Policy will take effect from the date of the AGM and apply for a period of up to three years. The

2023 Remuneration Policy is set out on pages 86 to 94.

As an Irish incorporated company, Greencore is not subject to UK executive remuneration requirements as set out in the Large and

Medium-Sized Companies and Groups (Accounts and Reports) Regulations 2008, as updated. The EU Shareholder Rights’ Directive II

(‘SRD II’) requirements only apply to companies whose shares are admitted to trading on an EU regulated market, which, following Brexit,

does not include Greencore as we are solely listed on the London Stock Exchange. Nonetheless, as a matter of good practice and in

order to ensure transparency to all of our stakeholders, we have sought to comply with both regulations on a voluntary basis in respect of

the members of the Board.

FY22 remuneration outcomes

FY22 Annual Bonus Plan (‘ABP’)

The maximum annual bonus opportunity of 150% of basic salary for the Chief Financial Officer (‘CFO’) was based on a mix of financial

elements (weighted 75% of the bonus) and personal and strategic objectives (weighted 25% of the bonus) for FY22. Neither Patrick Coveney

(who resigned in FY22) nor Dalton Philips (whose appointment as Executive Director and Chief Executive Officer (‘CEO’) was effective shortly

before the end of FY22) were eligible to participate in the FY22 ABP.

The financial performance targets and actual performance outcomes for FY22 are set out in the table below. Further details on the

achievement of personal and strategic objectives are set out on pages 100 and 101.

Performance targets

Measure

Weighting

(% of total)

Threshold

(0% payout)

Target

(50% payout)

Stretch

(100% payout)

Actual FY22

outturn/

achievement

Resulting bonus

outcome

Adjusted Operating Profit 50% £72.0m £76.0m £84.0m £72.2m 1.25% out of 50%

Free Cash Flow 25% £45.9m £48.5m £53.5m £58.7m 25.00% out of 25%

Financial element 75% 26.25% out of 75%

Personal and strategic objectives 25% 20.00% out of 25%

Total 100% 46.25% out of 100%

Discretion applied by the Committee n/a

Payout 46.25% out of 100%

FY20 Performance Share Plan (‘PSP’)

The FY20 PSP award is based 1/3rd on Adjusted EPS growth, 1/3rd on ROIC and 1/3rd on relative TSR performance conditions.

The performance targets were not met and awards will lapse in full. Target and actual outturns are set out in the table below.

Measure

Weighting

(% of award) Performance targets Actual FY22 outturn

Vesting

(% of award)

Adjusted EPS growth 1/3rd 5% to 15% p.a. (16.8)% p.a. 0%

ROIC 1/3rd 13% to 15% 8.4% 0%

Relative TSR vs. bespoke group of sector peers 1/3rd Median to upper quartile Below median 0%

Total 0%

FY21 Performance Share Plan (‘PSP’)

As previously reported, the FY21 PSP award comprised three tranches, vesting subject to absolute TSR performance over periods of one, two and

three years from the date of grant on 8 January 2021. The Year 1 tranche lapsed in full and, while the Year 2 tranche is still in flight at the date of this

Report, the performance period has largely been completed. Based on performance to date, the Year 2 tranche is also expected to lapse in full.

The purpose of this section is to provide an overview of the Group’s performance in FY22, as well as

the remuneration received by our Executive Directors. Full details can be found in the Annual Report

on Remuneration on pages 97 to 108.

Remuneration

at a glance

96 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

Remuneration at a glance continued

Implementation of the 2023 Remuneration Policy in FY23

Element of pay Implementation for FY23

Fixed remuneration

Base salary Dalton Philips was appointed on a salary of €700,000 and which will not be increased for FY23.

As explained at the start of this Report, Emma Hynes received a 3% salary increase (workforce median: 4.8%) effective

from 1 October 2022. Her FY23 salary is €490,280.

Pension In line with the 2023 Remuneration Policy, Dalton Philips and Emma Hynes each receive a pension contribution of 8%

of salary, which is in line with the pension contribution currently available to the wider colleague base.

Benefits In line with Policy.

Variable pay

Annual Bonus Plan

(‘ABP’) and Deferred

Bonus Plan (‘DBP’)

No change to maximum opportunity: 150% of salary for CEO and CFO.

The performance measures for FY23 are: 50% Adjusted Operating Profit, 25% Free Cash Flow and 25% personal and

strategic objectives. 50% of any bonus earned will be deferred into shares for three years under the DBP, consistent

with the 2023 Remuneration Policy (and unchanged from the 2020 Policy).

Performance Share

Plan (‘PSP’)

CEO – 175% salary

CFO – 150% salary

The Committee remains mindful of the risk that ongoing market volatility could generate windfall gains for PSP awards

over the vesting period. For the FY23 cycle, the Committee has decided that assessing for windfall gains at vesting

(rather than making an ex ante reduction to the award opportunity) is more appropriate in the specific circumstances

for the Group, notably the recent leadership transition (this being the first PSP award for the CEO). The Committee’s

view is that it also is in all stakeholders’ interests that participants (including both Executive Directors) are appropriately

incentivised to deliver sustainable value creation, notwithstanding the ongoing challenges of our operating

environment.

PSP awards will continue to be based on three year performance against three performance measures: 1/3 cumulative

Adjusted EPS, 1/3 ROIC and 1/3 relative TSR vs. a bespoke group of sector peers.

PSP awards granted to Executive Directors are subject to a three year performance period and an additional two year

holding period. Vested awards may not be sold during the holding period except to cover tax liabilities.

Safeguards and risk

management

Malus and clawback provisions apply to the ABP and the PSP both prior to vesting and for a period of two years

post-vesting. This enables the Company to withhold payment/vesting of any sums and/or recover sums paid on the

occurrence of specific trigger events, including but not limited to misconduct, a material misstatement of the

Company’s audited results, a material failure of risk management, a material breach of health and safety regulations, or

serious reputational damage.

97Strategic Report | Directors’ Report | Financial Statements

As set out on page 86, the 2023 Remuneration Policy will be subject to an advisory shareholder vote at the AGM of the Company to be held

on 26 January 2023. The Annual Report on Remuneration will also be subject to an advisory shareholder vote at the AGM. Where information

has been audited, this has been stated. All other information in this report is unaudited.

Role of the Committee

The Committee’s collective role includes ensuring that the Group’s remuneration arrangements are aligned with the Group’s strategic

priorities. The Terms of Reference of the Committee include the determination of the remuneration packages for Executive Directors, the

Group Company Secretary and other members of the senior management team, as well as fees for the Board Chair. The Board Chair and the

Executive Directors determine the fees for the Non-Executive Directors.

The Terms of Reference for the Committee are reviewed annually and are updated as appropriate and are available under the Governance

section of the Group’s website, www.greencore.com.

Committee membership

The Committee is currently comprised of three Non-Executive Directors, all of whom are considered by the Board to be independent:

Committee member Date appointed

Attendance at scheduled

Committee meetings

during FY22

Linda Hickey 1 February 2021 (Appointed to the Committee and as Committee Chair on 1 February 2021) 4/4

Paul Drechsler Appointed on 14 May 2020 4/4

Anne O’Leary Appointed on 21 June 2022 2/2

Gordon Hardie (Appointed on 1 February 2020 and stepped down on 3 May 2022) 1/1

Gary Kennedy (Appointed on 11 March 2010 and stepped down on 21 June 2022) 2/2

Gordon Hardie stepped down from the Committee and the Board on 3 May 2022. Gary Kennedy stepped down from the Committee on

21 June 2022, with Anne O’Leary joining the Committee on this date. I would like to take this opportunity to thank Gordon and Gary for their

dedication and contribution to the Committee during their respective tenures.

Each of the Committee members has extensive experience on remuneration related matters, gained from both their executive careers and

from their experience on remuneration and compensation committees of other companies. Further details on the Committee members’

qualifications and experience are set out on pages 54 and 55. The Group Company Secretary or their nominee acts as Secretary to the

Committee. During the year, the Chief Executive Officer (‘CEO’), Chief Financial Officer (‘CFO’) and the Chief People Officer attended meetings

on an ad hoc basis at the invitation of the Committee and provided information and support as requested. However, no individual was present

when their own remuneration was being discussed.

Committee effectiveness

As noted on page 71, Independent Audit Limited (‘Independent Audit’), an external consultancy firm was engaged to conduct the FY21 annual

evaluation of the Board and Board Committees which was completed in January 2022. The FY22 review of the operation, performance and

effectiveness of the Committee was conducted using an online questionnaire via Independent Audit’s ‘Thinking Board Evaluator’ portal and a

performance evaluation discussion was included on the agenda for the Committee at its September 2022 meeting, supported by an analysis

of how the Committee was performing against key areas of its Terms of Reference. Both reviews confirmed that the Committee continues to

operate effectively and efficiently and has the skills and expertise required in order to perform its role appropriately. Target setting was flagged

by some Committee members as a key area of focus for FY23, particularly in the context of the ongoing uncertainty and volatility in the

Group’s operating environment. The Committee remains mindful that targets should be stretching (to reinforce alignment with stakeholder

interests and incentivise outperformance) and reflect external market conditions. It is in this context that targets for the FY23 incentive cycles

will be set – and in which future targets will continue to be considered.

Advisors

The Committee’s appointed independent advisors during the year were Ellason LLP (‘Ellason’). Ellason attends Committee meetings on an ad

hoc basis and provides advice on remuneration for Executive Directors, benchmarking analysis, and updates on market developments and

best practice. Ellason is a member of the Remuneration Consultants Group and adheres to its code of conduct. The Committee reviews the

performance of its advisors annually and is satisfied that Ellason provided independent and objective remuneration advice to the Committee,

The following section sets out our Annual Report on Remuneration, outlining decisions made by the

Committee in relation to Directors’ remuneration in respect of FY22 and how the Committee intends

to apply the proposed Policy (‘2023 Remuneration Policy’) for FY23.

Annual Report

on Remuneration

98 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

Annual Report on Remuneration continued

noting that Ellason does not have any personal connections to Greencore or any individual Director. Services were provided on a time and

materials basis. The fees paid to Ellason in respect of work carried out for the Committee in the year under review amounted to £77,885.

Ellason did not provide any other services to the Company during the year.

Key activities during the year

During FY22, the Committee held four scheduled meetings, as well as three additional ad hoc meetings. All Committee members attended all

scheduled and unscheduled meetings for which they were eligible to attend. Details of attendance at scheduled meetings can be found on

page 97. The key activities and matters discussed at Committee meetings during FY22 included:

• Engaging with, and reviewing feedback received from, shareholders on the 2022 AGM outcome;

• Reviewing the external remuneration landscape generally and considering best practice corporate governance;

• Approval of opportunities/award levels and performance targets for the FY22 Annual Bonus Plan and PSP awards;

• Reviewing and approving performance and outturns under the FY21 ABP, the FY19 PSP awards, and Tranche 1 of the FY21 PSP awards

(which lapsed in full during FY22);

• Reviewing and approving the FY21 Report on Directors’ Remuneration;

• Approving the remuneration arrangements for the outgoing CEO and recommending to the Board the fee arrangements for the Executive

Chair role and the exertion fee for the Board Chair;

• Reviewing workforce remuneration structures, pensions and the salary review process;

• Reviewing the Irish and UK ShareSave Schemes activities;

• Designing, reviewing and seeking shareholder feedback on the 2023 Remuneration Policy;

• Determining and recommending to the Board the remuneration arrangements for the incoming CEO and Board Chair;

• Reviewing the service contracts and notice period for the senior management team;

• Considering how ESG objectives can be reflected in the remuneration framework; and

• Reviewing the Committee’s Terms of Reference and the Committee’s effectiveness.

Shareholder voting

The table below shows the voting outcome of the resolutions proposed at the 2020 and 2022 AGMs in relation to the 2020 Remuneration

Policy and the FY21 Annual Report on Remuneration.

Resolution For Against Total votes cast Votes withheld

2020 Remuneration Policy (2020 AGM)

68.44% 31.56% 332,036,575 8,594,083

FY21 Annual Report on Remuneration (2022 AGM)

53.71% 46.29% 291,695,180 40,244,795

1. The voting outcome for the 2020 Remuneration Policy related primarily to the pension arrangement for the former CEO. Pension contributions for the incumbent

directors (and future hires) are aligned with those provided to the wider workforce. This change has been reflected in the 2023 Remuneration Policy being put to

shareholders for approval at the 2023 AGM.

2. The Committee’s engagement with shareholders following the vote on the FY21 Annual Report on Remuneration is discussed in the Chair’s introductory statement.

Single figure of total remuneration for Executive Directors (audited)

The following table sets out the single figure of total remuneration for Executive Directors for FY22 and FY21.

Salary

(‘000)

Pension

(‘000)

Benefits

(‘000)

Total fixed

(‘000)

Annual

bonus

– cash

(‘000)

Annual

bonus

– deferred

award

(‘000)

PSP

(‘000)

Total

variable

(‘000)

Total

remuneration

(‘000)

Total fixed

vs. Total

remuneration

Total variable

vs. Total

remuneration

Patrick FY22 €422 €114 €40 €576 – – – –

€576 100% 0%

Coveney

FY21 €851 €251 €64 €1,166 €0 €0 €0 €0

€1,166 100% 0%

Emma FY22 €476 €38 €38 €552 €165 €165 €0 €330

€882 63% 37%

Hynes FY21 €476 €38 €38 €552 €0 €343 €0 €343

€895 62% 38%

Gary FY22 €344 – – €344 – – – –

€344 100% 0%

Kennedy

FY21 – – – – – – – –

– – –

Dalton FY22 €13 €1 €1 €15 – – – –

€15 100% 0%

Philips

FY21 – – – – – – – –

– – –

1. Patrick Coveney resigned from his role as Executive Director and CEO on 30 March 2022. His FY22 salary, pension and benefits relate to the period 25 September 2021 to

30 March 2022.

2. Gary Kennedy was appointed Executive Chair on 31 March 2022. He received an additional fee to reflect the additional time commitment and the responsibilities

associated with this appointment. Gary Kennedy was not eligible to participate in any performance based pay. The figure shown above relates to the total fee received

during the period from 31 March 2022 to 25 September 2022, when he reverted to the role of Non-Executive Chair following the appointment of Dalton Philips as

Executive Director and CEO on 26 September 2022.

3. Dalton Philips was appointed to the Board as Executive Director and CEO on 26 September 2022. His FY22 salary, pension and benefits relate to the period 26 September

2022 to 30 September 2022.

4. Benefits include car allowance as well as medical insurance.

5. Emma Hynes was awarded an annual bonus of 46.25% of the maximum opportunity for FY22, of which 50% is to be deferred in shares for three years (FY21: 100% deferred),

as set out on pages 99 to 101. Patrick Coveney was not entitled to a bonus for FY22. His FY21 bonus awarded was €612k, to be deferred in shares. However, following his

resignation, the grant of deferred shares in December 2021 was not made and therefore he received no bonus (in cash or shares) in respect of FY21 performance.

6. As set out on page 102, the threshold performance hurdles for the FY20 PSP were not achieved and this award will lapse in May 2023. The performance period for the

Year 2 tranche of the FY21 PSP ends on 8 January 2023. Based on the share price at the date of signing this Report, the minimum performance hurdle for the Year 2

tranche has not been achieved, therefore an estimated vesting figure of 0% has been included.

99Strategic Report | Directors’ Report | Financial Statements

Single figure of total remuneration for Non-Executive Directors (audited)

The following table sets out the single figure of total remuneration for Non-Executive Directors in FY22 and FY21.

Base fee Additional fees

Total fees

John Amaechi

FY22 €78,000 – €78,000

FY21 €52,000 – €52,000

Sly Bailey (Senior Independent Director and Chair of Nomination

and Governance Committee)

FY22 €78,000 €16,500 €94,500

FY21 €78,000 €16,500 €94,500

Paul Drechsler FY22 €78,000 – €78,000

FY21 €78,000 – €78,000

Gordon Hardie

FY22 €46,091 – €46,091

FY21 €78,000 – €78,000

Linda Hickey

(Chair of the Remuneration Committee) FY22 €78,000 €12,000 €90,000

FY21 €52,000 €8,000 €60,000

Gary Kennedy

(Board Chair) FY22 €40,195 €253,892 €294,087

FY21 €78,000 €247,000 €325,000

Anne O’Leary

FY22 €78,000 – €78,000

FY21 €52,000 – €52,000

Helen Rose FY22 €78,000 – €78,000

FY21 €78,000 – €78,000

Helen Weir

(Chair of the Audit and Risk Committee) FY22 €78,000 €16,500 €94,500

FY21 €78,000 €11,200 €89,200

1. As set out in the 2020 Remuneration Policy and the 2023 Remuneration Policy (which is being put to shareholders for approval), if a Non-Executive Director is Senior

Independent Director and is also Chair of the Nomination and Governance Committee, the additional fee is capped at the additional Senior Independent Director fee.

Therefore, Sly Bailey does not receive a fee for her role as Chair of the Nomination and Governance Committee.

2. John Amaechi was appointed to the Board on 1 February 2021. John’s FY21 fees relate to the period 1 February 2021 to 24 September 2021.

3. Gordon Hardie stepped down from the Board and as Non-Executive Director on 3 May 2022. Gordon’s FY22 fees relate to the period 25 September 2021 to 3 May 2022.

4. Linda Hickey was appointed to the Board and as Chair of the Remuneration Committee on 1 February 2021. Linda’s FY21 fees relate to the period 1 February 2021 to

24 September 2021.

5. The figures report only the fees paid to Gary Kennedy in his capacity as Non-Executive Chair from 25 September 2021 to 30 March 2022 and from 26 September 2022 to

30 September 2022. For the period 1 December 2021 to 30 March 2022, Gary Kennedy received an additional exertion fee of €32,000 per month to reflect his more

active role in the business and the associated additional time commitment, before he assumed the role of Executive Chair. He was appointed to the role of Executive

Chair on 31 March 2022 and the fees paid for this period are shown in the table on page 98. He resumed the role of Non-Executive Chair on 26 September 2022.

6. Anne O’Leary was appointed to the Board on 1 February 2021. Anne’s FY21 fees relate to the period 1 February 2021 to 24 September 2021.

7. Helen Weir became Chair of the Audit and Risk Committee with effect from 26 January 2021.

Notes to the single figure table (audited)

Base salary

The FY22 salaries were €850,705 for Patrick Coveney (unchanged since 1 October 2019), €476,000 for Emma Hynes (as set on appointment

on 19 May 2020) and €700,000 for Dalton Philips (as set on appointment on 26 September 2022).

Pension

Emma Hynes and Dalton Philips receive a pension contribution equivalent to 8% of salary, which remains in line with the contribution to the

wider colleague base.

As disclosed in the FY21 Annual Report on Remuneration, Patrick Coveney’s non-pensionable cash allowance was being reduced by 5%

annually from 35% of pensionable earnings to 15% of pensionable earnings on a phased basis over four years, commencing on 1 April 2020.

Therefore, Patrick Coveney’s non-pensionable cash allowance for the period 1 April 2021 to 30 March 2022 was 25% of pensionable earnings.

Patrick is also a deferred member of the Group’s Irish Defined Benefit Pension Scheme which closed to future accrual with effect from

31 December 2009. The value of the scheme benefits for Patrick was £52,027 as at 30 March 2022. His normal retirement age under the

scheme is 60 and he was not entitled to any augmentation of benefit in the event that he retired early.

FY22 Annual Bonus Plan (‘ABP’)

The maximum bonus opportunity for Emma Hynes in FY22 was 150% of salary. Following his resignation, Patrick Coveney was not eligible to

receive an annual bonus for FY22. The annual bonus is based on the achievement of stretching short term financial targets (75% of maximum

bonus opportunity) as well as personal and strategic objectives (25% of maximum bonus opportunity). The mix of measures reflects the

Committee’s aim of providing an appropriate balance between incentivising the achievement of key financial targets and specific personal and

strategic objectives.

Performance targets and outturns are set out in the tables overleaf. Both Adjusted Operating Profit and Free Cash Flow are Group KPIs referred

100 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

Annual Report on Remuneration continued

to as an Alternative Performance Measure (‘APM’). APMs are non-IFRS measures and are used to monitor the performance of the Group’s

operations and of the Group as a whole. Definitions and reconciliations to IFRS measures are provided in the APMs section on pages 179 to

183.

Group financial objectives FY22 (75% weighting)

Performance targets

Measure

Threshold

(0% payout)

Target

(50% payout)

Stretch

(100% payout)

Actual outturn/

achievement

% payout of

element

Adjusted Operating Profit (50%) £72.0m £76.0m £84.0m £72.2m 2.5%

Free Cash Flow (25%) £45.9m £48.5m £53.5m £58.7m 100.0%

1. There is a straight-line scale between threshold and target, and between target and stretch.

In keeping with the Committee’s usual practice, the formulaic outcome for the financial element of the FY22 ABP was reviewed in the context

of the stakeholder experience and wider performance context for the Group over the course of the year.

In determining that the formulaic outcome was a fair reflection of underlying business performance, and hence no adjustment was necessary,

the Committee took into consideration the broader context of the outturns. The Committee concluded that the AOP outturn, although only

incrementally ahead of the threshold set at the start of FY22, nevertheless represented a solid performance in the context of the unbudgeted

headwinds faced in the year. These included the impact of inflation, labour availability and supply chain disruption, as well as the operational

disruption arising from the weather conditions experienced this summer. The Committee also reviewed the underlying drivers of the excellent

Free Cash Flow outturn for the year under review and was satisfied that the net effect of unbudgeted headwinds and tailwinds (compared to

the assumptions on which the targets were based at the start of the year) did not merit adjustment. As a result, and to ensure that the bonus

continues to drive and reward the right behaviours as well as performance, the Committee decided not to make any adjustments to the

formulaic outcome of the financial element for the FY22 ABP.

Personal and strategic objectives for the CFO in FY22

Strategic priorities

Growth Relevance Differentiation

The Committee believes in the importance of incorporating robust measures that fall outside the strict financial performance measures, but

nonetheless draw a sharp focus on issues that are demonstrably linked to the protection and creation of value.

The personal and strategic objectives comprised seven categories aligned to short-term priorities and non-financial KPIs for the Group, and

included the following objectives:

Met?

Category Objective(s) set No Partly Fully Commentary

Organisation

Support the leadership transition and collaborate

effectively with other senior leaders to ensure

continuity for stakeholders in FY22

✓

Provided outstanding support

to the Executive Chair during

FY22. Supported continuity of,

and contributed effectively to,

Group leadership; and was a key

stakeholder in the recruitment

of the CEO

Risk

Continue to focus on reset of Risk and Internal

Audit processes

✓

Significant progress made on the

risk agenda, as endorsed by the

Audit and Risk Committee. Agreed

team structure now in place, as

are effective processes to drive

focus within teams

Embed risk management as part of emerging

organisation design, increasing the profile of,

and accountability for, risk management within

functional teams

✓

Embed appropriate team structure

✓

Capital management

Continued focus on deleverage and balance

sheet strengthening

✓

Fully delivered the objectives set,

with particularly strong outcomes

in relation to progress on leverage

reduction for the business and

discipline around cash generation

101Strategic Report | Directors’ Report | Financial Statements

Met?

Category Objective(s) set No Partly Fully Commentary

Sustainability

Ensure carbon data methodology and data collection

process is robust enough to anchor our ESG roadmap.

Address performance issues and capability requirements

to drive forward our Sustainability agenda

✓

Progress was made during the

year in driving forward our agenda

for what is a principal risk for the

Company. However, the

objectives were not met in full,

with this outcome reflected in

the overall assessment

Establish robust Internal Carbon Pricing (“ICP”) model to

underpin ESG cost of future investment decisions

✓

Better Greencore

Take a leading role in the planning and delivery of Better

Greencore:

Sponsored workstreams

exceeded objectives set. Good

progress has been made on the

reset of the finance organisation,

but this is not yet completed

• Ensure sponsored workstreams deliver against project

expectations

✓

• Reset finance organisation in line with agreed

operational targets

✓

External

Effectively build and manage new relationships with

shareholders and other external stakeholders to facilitate

continuity during the leadership transition in FY22

✓

Widely respected by the

investment community, receiving

positive feedback from

stakeholders and exceeding

expectations against these

objectives

Deliver a clear and effective market communication

strategy around financial resilience and Better Greencore

✓

Financial delivery

Hold business to account on key deliverables

including inflation recovery

✓

Held operational and commercial

teams to account in supporting

successful recovery of inflation.

In conjunction with other key

deliverables, this was essential

as part of the restoration of our

economic model

Outcomes and discretion

As described above, the Committee carefully assessed the performance of the CFO against the personal and strategic measures set, in line

with normal practice. As a result of the continued strong and valued contribution of the CFO against these objectives, the Committee

determined that 80% of this element had been achieved (i.e. 20% of the maximum bonus opportunity).

Overall, the formulaic assessment of targets warranted a bonus payout of 46.25% of maximum.

The Committee then reviewed this outcome in the context of the Group’s underlying performance and the stakeholder experience more

generally. In determining that the formulaic outcome was appropriate (and that no exercise of discretion was necessary to adjust the ABP

payout for these broader considerations), the Committee took into account Greencore’s resilient operational and commercial progress against

key elements of its strategy during the year, and the continued focus by management on putting our colleagues first (further details on which

are set out on page85). The Committee concluded that the formulaic outcome appropriately reflected that good performance outcomes had

been delivered and the right behaviours demonstrated in doing so; aligning with our corporate values, and our remuneration principles of

‘pay-for-performance’ and ‘alignment and fairness’.

Long term incentives

FY20 PSP awards

On appointment in May 2020, Emma Hynes received awards under the PSP (‘FY20 PSPs’) as set out in the table below:

Executive Director Date of grant

Number of

awards granted

Share price on

date of grant

Face value on

date of grant

Awards as % of

annualised salary

Vesting

date

Holding period

expiry

Emma Hynes 22 May 2020 150,000 £1.370

£205k c.50% 22 May 2023 22 May 2025

1. Average share price for the three days commencing on 19 May 2020.

102 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

Annual Report on Remuneration continued

The FY20 PSPs were subject to Adjusted EPS, ROIC and TSR performance targets measured over the period FY20 to FY22, using FY19 as

the base year. Performance targets for the FY20 awards were set taking into account a range of reference points, including the Group’s

strategic plan.

The performance targets were not met, and therefore the awards granted to Emma Hynes will lapse in full. As Dalton Philips joined the Board

during FY22, he did not hold any awards under the FY20 PSP. Patrick Coveney’s FY20 PSP award lapsed on leaving the Company. The targets

and performance outturns are set out in the table below:

Measure Weighting (% of award) Performance targets Actual FY22 outturn Vesting (% of award)

Adjusted EPS growth 1/3rd 5% to 15% p.a. (16.8)% p.a. 0%

FY22 ROIC 1/3rd 13% to 15% 8.4% 0%

Relative TSR vs. bespoke group of sector peers 1/3rd Median to upper quartile Below median 0%

Total

Each of the financial performance measures under the FY22 ABP and the FY20 PSP are Key Performance Indicators (‘KPIs’) as set out

on pages 36 and 37. The KPIs are non-IFRS measures, referred to as APMs, and are used to monitor the performance of the Group’s

operations and the Group as a whole. Definitions of the APMs and reconciliations to IFRS measures are provided in the APMs section

from pages 179 to 183.

FY21 PSP awards

Emma Hynes received awards under the FY21 PSP as set out in the table below. As Dalton Philips joined the Board at the end of FY22, he did

not participate in the FY21 PSP grant. Patrick Coveney’s FY21 PSP award lapsed on his leaving the Company.

Executive Director Date of grant

Number of awards

granted

Share price on

date of grant

Face value

on grant

Awards as % of

annualised salary

Vesting date

Holding period

expiry

Emma Hynes 8 January 2021 523,620 £1.122 £588k c.137% See footnote 8 January 2026

1. Average share price for the three days commencing on 5 January 2021.

2. Calculated based on full eligible FY21 salary and the face value on grant, which has then been converted into euro using the exchange rate for the date of grant of

£1:€1.11. Source: Bloomberg.

3. 15% of the awards were due to vest on 8 January 2022, 25% on 8 January 2023 and 60% on 8 January 2024. Awards may be sold only to cover tax liabilities. Any shares

vesting (net of tax) must be held until the fifth anniversary of grant. Tranche 1 has since lapsed and Tranche 2 is expected to lapse in January 2023 (see next table).

As set out in the FY21 Annual Report on Remuneration, the Committee simplified its approach for the FY21 PSP award, with vesting of 100% of

the award based on absolute TSR targets over a three year period commencing on the date of grant. These targets are set out below:

Tranche

Weighting

(% of award)

Return Index

(‘RI’) hurdle Status Measurement basis

Year 1 15 165p Lapsed

Average RI for the month preceding the first anniversary of grant

Year 2 25 219p Expected to lapse

Average RI for the month preceding the second anniversary of grant

Year 3 60 291p Inflight Average RI for the month preceding the third anniversary of grant

1. Share price growth plus dividends (assumed reinvested on the ex-dividend date).

2. Both Absolute TSR and Relative TSR assessments will be based on the average Return Index for the month preceding the end of the relevant performance period.

3. The Year 1 tranche lapsed in full.

4. Based on the share price as at the date of signing this Report, the performance hurdle for the Year 2 tranche is not expected to be achieved.

Vesting of the awards is also subject to two underpins being met. The number of shares vesting under each tranche will be reduced by 50% if

the Group’s Relative TSR performance is below the median of its TSR comparator group over the relevant performance period. In addition, a

discretionary assessment of Greencore’s underlying performance will be undertaken by the Committee. Details of the TSR comparator group

and factors that may be considered when assessing the performance underpin are set out on page 100 of the FY21 Annual Report and

Financial Statements. Any shares that vest will be required to be held until the fifth anniversary of grant, ensuring alignment with long term

shareholders and the delivery of sustainable long term returns.

FY22 PSP awards

Emma Hynes received awards under the FY22 PSP as set out in the table below. As Dalton Philips joined the Board at the end of FY22, he did

not participate in the FY22 PSP grant. Patrick Coveney was not eligible for an award having tendered his resignation prior to the date of grant.

Executive Director Date of grant

Number of

awards granted

Share price on

date of grant

Face value

on grant

Awards as %

of salary

Vesting date Holding period expiry

Emma Hynes 6 December 2021 470,079 £1.290 £607k 150% 6 December 2024 6 December 2026

1. Average share price for the three days commencing on 30 November 2021.

2. Calculated based on FY22 salary and the face value on grant, which has then been converted into euro using the exchange rate on 2 December 2021 of €1:£0.8495.

Source: Bloomberg.

103Strategic Report | Directors’ Report | Financial Statements

The performance measures are Adjusted EPS, ROIC and Relative TSR. Adjusted EPS targets for this cycle have been set (and performance will

be measured) on a three year cumulative pence basis, to reduce the sensitivity of outcomes to final year (i.e. FY24) performance alone and

better incentivise sustained EPS growth in each year of the performance period. Performance will be assessed over the period FY22 to FY24.

Full details of the performance targets were set out on page 102 of the Annual Report and Financial Statements 2021 and are summarised

below:

Measure

Weighting

(% of award)

Below threshold

(0% vesting)

Threshold

(25% vesting)

Stretch

(100% vesting)

Adjusted EPS (FY22 + FY23 + FY24) 1/3rd Below 33p 33p 41p

FY24 ROIC 1/3rd Below 10.7% 10.7% 13.0%

Relative TSR vs. bespoke group of sector peers

1/3rd Below median Median Upper quartile

1. A.G.Barr; Bakkavor; Britvic; Carr’s; Cranswick; Devro; Glanbia; Greggs; Hilton Food; Kerry Group; Premier Foods; and SSP Group.

As in previous years, the Committee will consider the underlying financial performance of the business as well as the value added to

shareholders in adjudicating the final PSP vesting level.

The Committee will review vesting levels at the conclusion of the performance period to ensure they reflect the underlying performance of

the business and to avoid any windfall gains for participants. The award will vest three years from the date of grant, subject to meeting the

performance conditions and continued employment, and a two year holding period will apply post vesting. Malus and clawback provisions

will apply both prior to vesting and for a period of two years post vesting, and vested awards may not be sold during the two year holding

period post vesting except to cover tax liabilities.

Deferred Bonus Plan (‘DBP’) awards granted in FY22

The following deferred bonus shares were awarded to Emma Hynes during FY22. Following his resignation, Patrick Coveney was not granted

an award. The award relates to the bonus awarded for performance during FY21.

Executive Director Date of grant

Number of

awards granted

Share price on

date of grant

Face value

on grant

Vesting date

Emma Hynes 6 December 2021 225,638 £1.290 £291k 6 December 2024

1. Average share price for the three days commencing on 30 November 2021.

2. Calculated based on FY22 salary and the face value on grant, which has then been converted into euro using the exchange rate for 2 December 2021 of €1:£0.8495.

Source: Bloomberg.

Payments for loss of office

Patrick Coveney resigned as Executive Director and CEO on 30 March 2022. As set out in last year’s Report on Remuneration, he received

salary, benefits and pension up to his date of departure. No payments were made to Patrick Coveney in connection with his resignation, other

than these contractual payments, which are disclosed in full in the single figure of total remuneration table on page 98. The grant of deferred

shares that was expected to be made in relation to the FY21 annual bonus outcome was not made and as a result he received no bonus (either

in cash or shares) in respect of FY21 performance. He was not eligible to participate in the FY22 annual bonus or receive a PSP grant in FY22

and all outstanding DBP and PSP awards lapsed in full on his resignation. There were no payments in lieu of notice, and he remains subject to

the post-employment shareholding guideline.

Payment to past Directors

No payments were made to past Directors during the year under review.

Implementation of the 2023 Remuneration Policy in FY23

Executive Director remuneration in FY23

A summary of how the proposed 2023 Remuneration Policy will be applied to Executive Director remuneration for FY23 is set out below.

Base salary

As set out on page 85, the Committee agreed that it would be appropriate to award a 3% salary increase to Emma Hynes, the first increase

since she joined Greencore in 2020. This compares to the median increase for our professional and managerial colleagues of 4.8%.

The FY23 salaries are as follows:

Executive Director Salary from 1 Oct 2022 Salary from 1 Oct 2021 Percentage increase

Emma Hynes €490,280 €476,000 3%

Dalton Philips

€700,000 – –

1. From date of appointment on 26 September 2022.

Pension and benefits

Emma Hynes and Dalton Philips receive a pension contribution of 8% of salary, which is in line with the pension contribution currently

available to the wider colleague base.

104 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

Annual Report on Remuneration continued

Annual Bonus Plan (‘ABP’)

The ABP will be based 75% on stretching financial performance targets and 25% on personal and strategic objectives.

The financial performance element will be split between Adjusted Operating Profit (weighted 50%) and Free Cash Flow (25%). The targets for

FY23 have been set based on full year performance and have been set with reference to budget as well as broker forecasts and other external

considerations. The targets for FY23 are considered commercially sensitive but will be disclosed in full on a retrospective basis in next year’s

Annual Report on Remuneration.

The remaining 25% of the bonus is based on personal and strategic objectives to help ensure a continued focus on the short and medium

term objectives that are most critical to the successful delivery of the strategy and long term sustainable performance of the Group. For FY23,

this element will again include objectives specifically linked to the roll-out of the Group’s sustainability strategy.

The outcomes of both the financial and non-financial KPIs will be considered by the Committee when determining the overall level of bonus

payable, and the Committee retains discretion to adjust the outcomes to take into account the wider stakeholder context.

The maximum opportunity for FY23 remains unchanged at 150% of salary. A minimum of half of any bonus will be deferred in shares, vesting

after three years subject to continued employment. Both the cash bonus and deferred share awards are subject to malus and clawback

provisions.

Long term incentive

The vesting of FY23 PSP awards will continue to be based on Greencore’s three-year performance against targets set in relation to three

measures: Adjusted EPS, ROIC and Relative TSR. As in previous years, the Committee will also consider the underlying financial performance

of the business (as well as the value added to shareholders) in adjudicating the final overall PSP vesting level.

At the time of publishing this Report, the performance targets in relation to the EPS and ROIC elements of the FY23 PSP cycle have not been

finalised. In doing so, the Committee will set targets that it considers to be stretching (to reinforce alignment with stakeholder interests and

incentivise outperformance) as well as relevant and motivational in the prevailing external market environment. The targets attaching to these

elements of the PSP award will be disclosed in the RNS announcement at the time of grant (which is anticipated to be in December 2022).

The Relative TSR performance condition is unchanged from the FY22 PSP cycle. Performance will be assessed over the period FY23 to FY25,

relative to the following bespoke group of sector peers: A.G.Barr; Bakkavor; Britvic; Carr’s; Cranswick; Devro; Glanbia; Greggs; Hilton Food;

Kerry Group; Premier Foods; and SSP Group. Performance will need to be median to trigger threshold vesting (25% of that element) and at

least upper quartile to trigger full vesting of that element. For performance outcomes between threshold and maximum, the vesting

percentage will be determined on the basis of a straight line sliding scale.

Dalton Philips will receive an award in FY23 at 175% of salary, in line with the terms of his appointment and within the Policy maximum of 200%

of salary. Emma Hynes will receive an award at 150% of salary. As described on page 96, the Committee remains mindful of the risk that

ongoing market volatility could generate windfall gains for PSP awards over the vesting period. Given the specific circumstances for the Group

(notably the recent leadership transition, this being the first PSP award for the CEO) and the belief that it is in all stakeholders’ interests that all

participants are appropriately incentivised to deliver sustainable value creation in a very challenging operating environment, the Committee

shall assess for windfall gains at vesting rather than make an ex ante reduction to the award opportunity. In doing so, the Committee will

review a range of relevant reference points for Greencore’s share price performance over the vesting period and disclose the basis of its

assessment in the relevant Annual Report on Remuneration.

The award will vest three years from the date of grant, subject to meeting the performance conditions and continued employment, and a two

year holding period will apply post vesting. Malus and clawback provisions will apply both prior to vesting and for a period of two years post

vesting, and vested awards may not be sold during the two year holding period post vesting except to cover tax liabilities.

Non-Executive Director fees in FY23

Non-Executive Director fees are determined by the Board Chair and the Executive Directors, with the exception of the fee for the Board Chair,

which is determined by the Committee. Basic fees shall not exceed the limit as set out in the Articles of Association and approved by

shareholders. The fees for the Chair were reviewed in 2022, during the recruitment process for the new Chair, and the fees for Non-Executive

Directors were last reviewed in November 2021, with no changes made. The full year equivalent fees are set out in the table below:

FY23 FY22

Basic fee

Chair €78,000

€78,000

Non-Executive Director €78,000

€78,000

Additional fees

Chair (Gary Kennedy, for period 1 October 2022 to 26 January 2023) €247,000

€247,000

Chair (Leslie Van de Walle, from 1 December 2022) €172,000

n/a

Senior Independent Director €16,500

€16,500

Audit and Risk Committee Chair €16,500

€16,500

Remuneration Committee Chair €12,000

€12,000

Nomination and Governance Committee Chair €10,000

€10,000

105Strategic Report | Directors’ Report | Financial Statements

Relative importance of spend on pay

The table below illustrates shareholder distributions (i.e. dividends and share buybacks) and total employee pay for FY22 and FY21, and the

year-on-year change.

FY22

(£‘000)

FY21

(‘£000)

Percentage

change

Distribution to shareholders

8,800 nil n/a

Total employee pay 380,900 306,400 24%

1. The Group did not pay dividends to shareholders in FY22. On 26 July 2022, the Company announced a share buyback programme of up to a maximum aggregate

consideration of £10m, which completed on 6 October 2022 (the ‘Buyback Programme’). During FY22, the Company purchased a total of 9,728,677 ordinary shares

under the Buyback Programme, returning a total of approximately £8.8m in cash to shareholders.

Historical TSR performance and remuneration outcomes for the CEO

The graph below compares the Company’s TSR against the FTSE All-Share Index and the FTSE 250 Index over a period of ten financial years

up to 30 September 2022. It reflects the change in a hypothetical £100 holding in shares. The FTSE 250 Index has been used to be consistent

with the approach used in previous years and as the Company was a constituent of this index until September 2022. For completeness, the

FTSE All-Share Index has been shown to provide an alternative reference point.

£300

£200

£100

£400

£500

Sep

£0

Greencore FTSE 250 Index FTSE All-Share Index

The table below illustrates the CEO’s single figure of total remuneration over the same ten financial year period to 30 September 2022.

Chief Executive Officer FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22

Single figure (€’000) €2,074 €2,590 €5,038 €3,131 €1,670 €1,414 €2,453 €1,120 €1,166 €935

Annual bonus outcome¹ 89% 98% 73% 83% 22% 18% 35% 0% 0% n/a

PSP vesting

2,3

n/a n/a 92.3% 79% 35% 0% 50% 0% 0% n/a

1. Patrick Coveney, Gary Kennedy and Dalton Philips were not eligible to participate in the FY22 Annual Bonus Plan.

2. No performance-based long term incentive awards were awarded prior to March 2013.

3. Patrick Coveney’s in-flight PSP awards lapsed on his resignation from the Company on 30 March 2022. Gary Kennedy and Dalton Philips did not participate in the FY20

PSP.

4. For FY22 this represents all remuneration paid to Patrick Coveney to 30 March 2022 (the date he resigned from the Company), payments made to Gary Kennedy in

respect of his role as Executive Chair (31 March 2022 to 25 September 2022) and payments to Dalton Philips from 26 September 2022 to 30 September 2022.

External appointments

We recognise the opportunities and benefits both to the Company and to the Executive Directors of their serving as Non-Executive Directors

of other companies. Executive Directors are generally permitted to take on one non-executive directorship with another publicly listed

company or other significant commitment subject to the approval of the Board. Any fees arising from these or other appointments will

generally be retained by the individual.

CEO pay ratio

The table overleaf shows the ratio of CEO pay for FY22 comparing the sum of the single total figures of remuneration for Patrick Coveney,

Gary Kennedy (in relation to that part of the year for which he acted as Executive Chair) and Dalton Philips (converted into GBP using the

average exchange rate for FY22 of €1:£0.8471), to the full-time equivalent total reward of those colleagues whose pay is ranked at the 25th,

50th and 75th percentiles in our UK workforce.

106 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

Annual Report on Remuneration continued

The colleagues used to calculate the pay ratios were identified using our 2022 gender pay gap data (Option B). The colleagues at the 25th,

50th and 75th percentiles were identified as at 5 April 2022 and their salary and total remuneration were calculated in respect of the 12 months

ended 30 September 2022. This method is deemed the most appropriate methodology for the Group as it makes use of our gender pay data

which provided a readily available and robust dataset. The Committee is satisfied that these colleagues are representative of the relevant

percentiles across the organisation, as they represent the large majority of our UK workforce receiving basic pay, overtime, holiday pay and

employers’ pension contributions. The resulting pay ratios are set out below:

Year Method 25th percentile 50th percentile 75th percentile

FY22 B 35:1 31:1 27:1

FY21 B 49:1 44:1 35:1

FY20 B 49:1 46:1 40:1

The table below provides the individual remuneration information in relation to our colleagues ranked at the 25th, 50th and 75th percentiles:

Year 25th percentile 50th percentile 75th percentile

FY22 Salary £21,320 £23,130 £26,666

Total pay and benefits £22,491 £25,229 £29,364

The Committee considers colleague pay levels and the resulting pay ratios as one of many reference points when reviewing executive

remuneration, and is pleased to note the year-on-year increase in colleague pay levels at the 25th, 50th and 75th percentiles. While the CEO

pay ratio in FY22 was again lower than the previous year, the Committee is mindful that this reflects the leadership transition during the year

under review and may therefore not be representative of the trend going forward. The Committee expects the pay ratio going forward to be

driven by fluctuations year-on-year in the CEO single figure to reflect the outcomes of variable remuneration components, the value of which

is aligned to the sustainable, long term success of the Company. However, the Committee will keep under review the evolution of the pay ratio

over future years in this context, to ensure it remains appropriate.

Outstanding share awards (audited)

Details of the Executive Directors’ existing share awards as at 30 September 2022 in the Company’s share schemes are set out in the table

below:

Date of grant

Number of

options/

awards at

start of year

Granted

during

the year

Vested/

exercised

in the year

Lapsed

during

the year

Number of

options/

awards at

year end

Market

price on

date of

grant

Exercise

price

Earliest date

of exercise/

vesting

Expiry date/

Holding

expiry date

Patrick Coveney

Deferred Bonus Plan

07/12/2018 54,788 – 57, 263 – – £1.806 – 07.12. 21 07.12.21

03/12/2019 78,193 – – 79,332 – £2.405 – 03.12.22 03.12.22

Performance Share Plan

FY19 08/02/2019 754,430 – – 764,613 – £1.957 – 08.02.22 08.02.24

FY20 03/12/2019 603,210 – – 611,282 – £2.405 – 03.12.22 03.12.24

FY21 Yr1 tranche 08/01/2021 150,869 – – 150,869 – £1.122 – 08.01.22 08.01.26

FY21 Yr2 tranche 08/01/2021 251,449 – – 251,449 – £1.122 – 08.01.23 08.01.26

FY21 Yr3 tranche 08/01/2021 603,478 – – 603,478 – £1.122 – 08.01.24 08.01.26

ShareSave 03/07/2020 15,126 – – 15,126 – £1.422 €1.190 01.09.23 29.02.24

Emma Hynes

Deferred Bonus Plan

06/12/2021 – 225,638 – – 225,638 £1.290 – 06.12.24 06.12.24

Performance Share Plan

FY20 22/05/2020 150,000 – – – 150,000 £1.370 – 22.05.23 22.05.25

FY21 Yr1 tranche 08/01/2021 78,543 – – 78,543 – £1.122 – 08.01.22 08.01.26

FY21 Yr2 tranche 08/01/2021 130,905 – – – 130,905 £1.122 – 08.01.23 08.01.26

FY21 Yr3 tranche 08/01/2021 314,172 – – – 314,172 £1.122 – 08.01.24 08.01.26

FY22 06/12/2021 – 470,079 – – 470,079 £1.290 – 06.12.24 06.12.26

1. All outstanding awards lapsed on leaving the Company.

2. The difference between the number of shares granted and vesting/lapsing under the Deferred Bonus Plan and Performance Share Plan represents dividend equivalents

which accrued on the awards. The share price on 10 December 2021, the date of vesting for the 2018 DBP award, was £1.355.

For the purposes of Section 305 of the Companies Act 2014, the aggregate gain by Executive Directors on the exercise of share options during

the year ended 30 September 2022 was £0 (FY21: £0). The value of conditional shares vesting to Executive Directors in the year was £77,591

(FY21: £135,591).

107Strategic Report | Directors’ Report | Financial Statements

Statement of directors’ shareholding and share interests (audited)

The Company has adopted Executive Director shareholding guidelines whereby all Executive Directors shall acquire a holding of shares in the

Company equal to 200% of base salary, typically over a five year period commencing on the date of their appointment to the Board.

As referred to in the 2020 and 2023 Policies, with effect from January 2020, Executive Directors are also subject to a post-employment

shareholding guideline. Executive Directors will normally be expected to maintain a holding of Greencore shares at a level equal to the lower

of the in-post shareholding guideline or the individual’s actual shareholding for a period of two years from the date the individual ceases to be

a Director. The specific application of this shareholding guideline will be at the Committee’s discretion.

There are currently no shareholding guidelines in place for Non-Executive Directors, however, all Non-Executive Directors are encouraged to

hold shares in the Company.

The table below shows the beneficial interests of Directors on 24 September 2021 and 30 September 2022 (including the beneficial interest of

their spouses, civil partners, children and stepchildren) in the Ordinary Shares of the Company, as well as unvested awards.

24 Sep 2021

(or appointment

if later)

Ordinary Shares

held at 30 Sep

2022 (or date of

departure if

earlier)

Shareholding

requirement

as % of salary

Shareholding

as % of salary

Shareholding

requirement

met

Scheme

interests subject

to deferral/

holding period

Scheme

interests

unvested and

subject to

performance

conditions

Share options

unvested and

not subject to

performance

conditions

Executive Directors

Patrick Coveney

2,770,686 2,798,066 200% 505% Yes n/a n/a n/a

Emma Hynes

140,357 140,357 200% 57% Building 225,638 1,065,156 Nil

Dalton Philips

n/a – 200% 0% Building Nil Nil Nil

Non-Executive Directors

John Amaechi

– – n/a n/a n/a n/a n/a n/a

Sly Bailey 64,504 64,504 n/a n/a n/a n/a n/a n/a

Paul Drechsler 43,015 43,015 n/a n/a n/a n/a n/a n/a

Gordon Hardie

100,000 100,000 n/a n/a n/a n/a n/a n/a

Linda Hickey

– – n/a n/a n/a n/a n/a n/a

Gary Kennedy 377,676 477,676 n/a n/a n/a n/a n/a n/a

Anne O’Leary

– – n/a n/a n/a n/a n/a n/a

Helen Rose 98,550 98,550 n/a n/a n/a n/a n/a n/a

Helen Weir 39,000 39,000 n/a n/a n/a n/a n/a n/a

Group Company Secretary

Jolene Gacquin

8,066 8,066 n/a n/a n/a n/a n/a n/a

1. Calculated based on FY22 salaries and the average share price between 1 July 2022 and 30 September 2023 of £0.924 (for Patrick Coveney, the average share price

between 31 December 2021 and 30 March 2022 of £1.301) which has then been converted into euro using the average exchange rate for FY22 of €1:£ 0.8471.

2. Includes deferred share awards which are included in the value of the shareholding (on a net of tax basis where these are unvested) and vested shares subject to a holding

period under the PSP where applicable.

3. Includes unvested PSP shares.

4. Patrick Coveney resigned from the Board as Executive Director and CEO on 30 March 2022 and is subject to the post-employment shareholding guideline.

5. Emma Hynes was appointed to the Board on 19 May 2020. Executive Directors have a period of five years from Board appointment to reach the shareholding guidelines.

6. Dalton Philips was appointed to the Board on 26 September 2022. Executive Directors have a period of five years from Board appointment to reach the shareholding

guidelines.

7. John Amaechi, Linda Hickey and Anne O’Leary were appointed to the Board as Non-Executive Directors with effect from 1 February 2021.

8. Gordon Hardie stepped down from the Board and as Non-Executive Director on 3 May 2022.

9. Jolene Gacquin resigned as Company Secretary and left the Company on 9 September 2022.

Between 30 September 2022 and the date of this Report there have been no changes in the Directors’ shareholdings.

None of the Directors had a material interest in any contract of significance, other than a service contract in the case of Executive Directors,

with the Company or any of its subsidiaries at any time during the period.

Share-based payments

The Group operates a ShareSave Scheme in both Ireland and in the UK, which encourages eligible employees to save in order to buy shares in

the Company. The ShareSave Schemes provide a means of saving and give employees the opportunity to become shareholders. Currently,

there are approximately 2,000 participants in the schemes. The Group’s Financial Statements recognise an Income Statement charge in

accordance with IFRS 2 Share-based Payment in respect of options issued under the ShareSave Scheme, and awards granted under the DBP

and the PSP. The related charge in respect of share-based payments issued to Executive Directors totaled £nil (FY21: £0.4m). Further detail in

respect of the DBP and PSP awards is outlined in Note 30 to the Group Financial Statements.

108 Greencore Group plc Annual Report and Financial Statements 2022

Report on Directors’ Remuneration continued

Annual Report on Remuneration continued

Share-based payments continued

Share awards and share options outstanding under the Company’s DBP, PSP and all employee plans at 30 September 2022 amounted to

22,907,111 Ordinary Shares (FY21: 23,050,850), made up as follows:

Number of

Ordinary Shares Price range

Normal vesting/

exercise dates

Deferred Bonus Plan 1,319,090 – 2022-2025

Performance Share Plan 6,089,094 – 2022-2025

ShareSave Scheme: UK 13,506,159 £0.91-£1.67 2022-2025

ShareSave Scheme: Ireland 81,376 €1.19-€1.75 2022-2024

Share Incentive Scheme 1,911,392 – 2025-2027

Funding of equity awards

Executive incentive arrangements are funded by a mix of newly issued shares and shares purchased in the market. Where shares are newly

issued, the Company complies with the Investment Association guidelines in relation to issuing a maximum of 5% of share capital in respect of

discretionary schemes and a maximum of 10% in respect of all share schemes in a rolling ten-year period. At 30 September 2022, there were

2,877,009 shares in the Company’s share ownership trust (as at 24 September 2021: 986,837). Current shareholder dilution is c.0.56%.

109Strategic Report | Directors’ Report | Financial Statements

Other statutory disclosures

Principal activities, results and review of business

Greencore is a leading manufacturer of convenience food in the UK and our purpose is to make every day taste better. We supply all of the

major supermarkets in the UK. We also supply convenience and travel retail outlets, discounters, coffee shops, foodservice and other retailers.

We have strong market positions in a range of categories including sandwiches, salads, sushi, chilled snacking, chilled ready meals, chilled

soups and sauces, chilled quiche, ambient sauces and pickles, and frozen Yorkshire Puddings.

In FY22 we manufactured 795m sandwiches and other food to go products, 127m chilled prepared meals, 249m jars of cooking sauces,

pickles and condiments, and 47m chilled soups and sauces. We carry out more than 10,600 direct to store deliveries each day. We have 23

manufacturing units across 16 locations in the UK, with industry-leading technology and supply chain capabilities. The Group also operates an

ingredient trading business in Ireland. The Group employs c. 14,000 people and is headquartered in Dublin, Ireland. Greencore’s shares are

listed on the London Stock Exchange and are included in the FTSE All Share Index Exchange.

The Group’s performance and development activity is summarised in the Operating and Financial Review set out on pages 38 to 41.

The Group Income Statement, which is set out on page 125, details the Group’s results for FY22. The Group reported Adjusted Operating

Profit for the year of £72.2m (FY21: £39.0m). Profit for the financial year was £32.3m (FY21: Profit £25.7m).

Dividends

The Group did not pay dividends to shareholders in FY22 and there is no proposed final dividend for the year (FY21: £nil).

Future developments

Revenue performance in the early weeks of FY23 has broadly held up however, the Group do note some mix effect between categories.

The Group remains cautious about the potential impact of the recessionary environment and cost-of-living factors on consumer spending

through the year ahead.

The Group expects that FY23 will be a year of further substantial inflation and the Group is working with its customers on recovery and

mitigation. The Group remains focused on the execution of the Better Greencore programme and continues to plan for the second phase

which will focus on operational and technological excellence.

The Group continues to make decisions on customer contracts which are no longer economic, with a heightened focus on the ability to

recover inflation.

The Group is confident that continued focus on the strengths of the business, underpinned by the Group’s resilient balance sheet and the

efficiency and productivity gains related to the Better Greencore programme will support further successful progress of the Group in the

years ahead.

Principal risks and uncertainties

Pursuant to Section 327(1)(b) of the Companies Act 2014, the 2018 UK Corporate Governance Code (the ‘Code’) and DTR 4.1.8R(2), the

principal risks and uncertainties that could affect the Group’s business are set out on pages 46 to 49 and are deemed to be incorporated in this

part of the Directors’ Report.

Principal subsidiaries

The principal subsidiary undertakings are listed in Note 31 to the Group Financial Statements.

Corporate governance

Statements by the Directors relating to the Group’s application of corporate governance principles, compliance with the principles and

provisions of the Code and the Irish Corporate Governance Annex (the ‘Annex’) are set out on pages 52 and 53. The Group’s system of internal

control and the adoption of the going concern basis in the preparation of the Group Financial Statements are set out on pages 42 to 49.

Greencore Group plc has applied the principles of the Code and complied with the provisions of the Code on a comply or explain basis for the

year ended 30 September 2022.

Greencore Group plc is registered in Ireland and, as an Irish incorporated company, it is not subject to the UK executive remuneration

requirements as set out in the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008, as updated.

Greencore Group plc is listed on the main market of the London Stock Exchange, and so it is not a ‘traded PLC’ for the purposes of Section

1110N of the Companies Act 2014. Nonetheless, in order to ensure transparency for all of our stakeholders, we have sought to comply with

these requirements on a voluntary basis in respect of the members of the Board to the extent possible under Irish law. The Report on

Directors’ Remuneration is contained on pages 83 to 108.

TCFD reporting

The Company’s compliance with the TCFD Recommendations and Recommended Disclosures pursuant to UK Listing Rule 9.8.6R is set on

pages 29 to 33.

110 Greencore Group plc Annual Report and Financial Statements 2022

Other statutory disclosures continued

Non-financial information statement

Pursuant to the European Union (Disclosure of Non-Financial and Diversity Information by certain large undertakings and groups) Regulations

2017 (‘Regulations’), the Group is required to report on certain non-financial information to provide an understanding of its development,

performance, position and the impact of its activities, relating to, at least, environmental matters, social matters, employee matters, respect for

human rights, and bribery and corruption. The Group’s Code of Ethics and Business Conduct takes into account all relevant laws including the

Regulations. The table below provides additional detail on the information required to be provided by the Regulations and highlights where

the information has been provided in this Annual Report and Financial Statements, where applicable.

Reporting requirement

Relevant policies, codes,

reports and statements* Initiatives/location of information** Page

Environmental

matters

• Code of Ethics and

Business Conduct

• Sustainability 20 to 33

Communities

• Code of Ethics and

Business Conduct

• Directors’ Report

• Sustainability

20 to 33, 65

Social and

employee matters

• Code of Business Practice

• Code of Ethics and

Business Conduct

• Ethical Code and

Employment Standards

Policy

• Directors’ Report

• Sustainability

• Non-financial KPIs

27, 28, 36, 64,

66 and 67

Human rights

• Code of Ethics and

Business Conduct

• Ethical Code and

Employment Standards

Policy

• FY21 Modern Slavery and

Human Trafficking

Transparency Statement

• Sustainability 21, 23, 29

and 63

Anti-bribery and

corruption

• Anti-Bribery and

Corruption Policy

Statement

• Code of Ethics and

Business Conduct

Greencore is committed to the highest standards of honesty

and integrity. The Group has a zero-tolerance approach to any

form of bribery or corruption. We provide annual training on our

Anti-Bribery and Corruption Compliance Manual and our Gifts

and Hospitality Policy which is available internally on our intranet.

Bribery risk assessments are conducted on an annual basis and

reported to the Audit and Risk Committee.

–

Prevention of

modern slavery

• Code of Ethics and

Business Conduct

• FY21 Modern Slavery and

Human Trafficking

Transparency Statement

The Group has a Group Ethics Committee in place whose role

includes driving progress in combatting modern slavery. We also

have a comprehensive education programme which sets out our

procedures for managing incidents of modern slavery, and training

on how to identify potential slavery or worker exploitation. This

training is provided by Stronger Together, a not-for-profit

organisation with specialist expertise in addressing hidden labour

exploitation. We prioritise collaborative programmes to prevent

modern slavery and are active members of the Food Network for

Ethical Trade (providing a broad range of tools and working groups)

and the Modern Slavery Intelligence Network (designed to disrupt

modern slavery through the sharing of intelligence). The Group

regularly reviews our management systems, primarily through

independent third party ethical audits, and resources dedicated

human rights recognised specialists in this space.

This initiative is supported by the UK’s ‘Gangmasters and Labour

Abuse Authority’. The Group regularly reviews eligibility to work

systems and has a number of pre-employment checks in place.

23 and 63

111Strategic Report | Directors’ Report | Financial Statements

Reporting requirement

Relevant policies, codes,

reports and statements* Initiatives/location of information** Page

Diversity

• Board Diversity Policy

• Code of Ethics and Business

Conduct

• Ethical Code and Employment

Standards Policy

• Group Inclusion and Diversity Policy

The Group continues to make progress against its

inclusion and diversity strategy and remains committed

to being an inclusive employer, embracing a diverse

workforce that is representative of all sections of

society. Continued progress has been made in respect

to inclusion and belonging, with increasing colleague

engagement in our inclusion activities, enabling

colleagues to be themselves at work. Our leadership

teams play a vital role in living this commitment, and

through their leadership and role modelling enable us

to make Greencore a great place to work for our

people.

Our Board also plays a vital role in this commitment and

continues to monitor the Group’s progress in this area.

No. of colleagues Ireland UK Total

Female 21 5,558 5,579

Male 10 8,505 8,515

Other n/a 4 4

Prefer not to say n/a 10 10

Total no. of

colleagues 31 14,077 14,108

At the end of the financial year, 39% of all colleagues

were female. Females made up 68% of our workforce in

Ireland and 39% in the UK. At Board level, 60% of our

Directors were female. Average female representation

on our subsidiary company boards was 42%. 29% of the

Group Executive Team (13% at the date of this Annual

Report) were female and 44% of the Group Executive

Team’s direct reports were female.

During the financial year we have delivered a

restructure of our organisation, in particular delivering

change at our executive level. As a founding member of

the 30% Club – which strives for 30% of leadership

positions to be held by women, we commit to keep

driving progress in this area paying particular attention

to understanding and tackling unconscious biases.

27,28, 71 and 75

Whistleblowing

• Code of Ethics and Business

Conduct

• Ethical Code and Employment

Standards Policy

• Whistleblowing and

Speak Up Policy

The Group ensures that details of the Group’s

Whistleblowing and Speak Up Policy and the associated

externally facilitated anonymous and independent

hotline (the ‘Hotline’) and web portal are available on

the Group website and are made visible by the presence

of posters at all sites and available to all colleagues and

third parties. In addition, details of the Hotline are

included in the Group Code of Business Conduct and

Ethics, which is also available on the Group website.

The Hotline number is toll free and issues can be raised

in multiple languages. All concerns raised through the

Hotline are managed through an approved, confidential

third-party provider. Any concerns raised are

appropriately investigated by the relevant business with

a target of 28 days to investigate and take action. The

Director of Internal Audit and Risk provides independent

oversight and supervision on all investigations, including

the reporting on whistleblowing activity to the Audit

and Risk Committee including providing assurance that

appropriate actions have been taken where required.

Further details are set out in page 81 of the Report of

the Audit and Risk Committee.

112 Greencore Group plc Annual Report and Financial Statements 2022

Other statutory disclosures continued

Reporting requirement

Relevant policies, codes,

reports and statements* Initiatives/location of information** Page

Business model

– Business model 6 and 7

Non-financial KPIs

– Key Performance Indicators 36 and 37

Principal risks

– Risks and risk management report 46 to 49

* Policies, codes, reports and statements are all available on the Group website www.greencore.com.

** The referenced sections of this document are deemed to be incorporated within this Directors’ Report.

Shareholders’ meetings

The Company operates under the Irish Companies Act 2014 (the ‘Act’). The Act provides for two types of shareholder meetings: the Annual

General Meeting (‘AGM’), with all other general meetings being called an Extraordinary General Meeting (‘EGM’).

The Company must hold a general meeting each year as its AGM, in addition to any other general meetings held in that year. Not more than 15

months may elapse between the date of one AGM and the next. EGMs can also be convened at the request of members holding not less than

5% of the voting share capital of the Company. The notice period for an AGM and an EGM to consider any special resolution (a resolution

which requires a 75% majority vote, not a simple majority) is 21 days.

No business shall be transacted at any general meeting unless a quorum is present at the time when the meeting proceeds to business. Two

members present in person or by proxy and entitled to vote shall be a quorum. Only those shareholders registered on the Company’s register

of members at the prescribed record date, being a date not more than 72 hours before the general meeting to which it relates, are entitled to

attend and vote at a general meeting.

Under the Act, ordinary resolutions may be passed by a majority of votes cast in favour, while special resolutions require a 75% majority of

votes cast in favour. Any shareholder who is entitled to attend, speak and vote at a general meeting is entitled to appoint one or more proxies

to attend, speak and vote on his or her behalf. A proxy need not be a member of the Company. Resolutions are voted on by either a show of

hands of those shareholders attending in person or by proxy, or, if validly requested, by way of a poll.

The business of the Company is managed by the Directors who may exercise all the powers of the Company unless they are required to be

exercised by the Company in a general meeting. Matters reserved to shareholders in general meetings include the election of Directors,

the declaration of final dividends on the recommendation of the Directors, the fixing of the remuneration of the external auditor, amendments

to the Articles of Association, measures to increase or reduce the ordinary share capital and the authority to issue shares.

Notice of general meetings and special business

The notice of the 2023 AGM, together with details of special business to be considered at the meeting, will be circulated to shareholders

during December 2022.

Share capital

As at 24 September 2021, there were 526,546,662 Ordinary Shares in issue. In FY22, 18,575 (FY21; 32,264) Ordinary Shares were issued under

the Company’s ShareSave Schemes.

On 26 July 2022, the Company announced a share buyback programme of up to a maximum aggregate consideration of £10m, which

completed on 6 October 2022 (the ‘Buyback Programme’).

During FY22, the Company purchased a total of 9,728,677 ordinary shares under the Buyback Programme, returning a total of £8.8m in cash

to shareholders. All shares purchased under the Buyback Programme were cancelled.

The table below sets out the ordinary shares purchased under the Buyback Programme during FY22. See Note 11 to the Consolidated

Financial Statements for further details.

Month

Total number of

share buyback

purchases

Average price

paid per share

July 428,499 1.0433

August 3,864,484 0.9847

September 5,435,694 0.8324

Total 9,728,677 0.9022

113Strategic Report | Directors’ Report | Financial Statements

As at 30 September 2022, Greencore’s issued ordinary share capital consisted of 516,836,560 Ordinary Shares with voting rights.

Between 1 October 2022 and 6 October 2022 the Company purchased a total 1,666,838 ordinary shares under the Buyback Programme,

returning a total of £1.2m in cash to shareholders.

One Special Share of €1.26 exists in the share capital of the Company. The Articles of Association provide that the Special Share may be held

only by, or transferred only to, the Minister for Agriculture, Food and the Marine or some other person appointed by the Minister. Under the

Articles of Association, the consent of the holder of the Special Share is required in the winding up of the Company. Many of the rights

attached to the Special Share were abolished in 2011.

At the AGM held on 27 January 2022, amongst other resolutions passed:

• Shareholders passed a resolution to give the Company, or any of its subsidiaries, the authority to make market purchases and overseas

market purchases of up to 10% of its own shares;

• Shareholders gave the Directors authority to allot shares up to a maximum nominal amount equal to approximately 33% of the aggregate

nominal value of the issued ordinary share capital of the Company;

• Shareholders gave authority to Directors to disapply pre-emption rights; and

• Shareholders gave authority to Directors to re-allot shares purchased by the Company and not cancelled as treasury shares.

At the forthcoming AGM scheduled to take place on 26 January 2023 (‘2023 AGM’) amongst other resolutions, Directors will seek:

• Authority to make market purchases or overseas market purchases of up to 10% of its own shares. If approved, any purchases will be made

only at price levels which the Directors consider to be in the best interests of the shareholders generally, taking into consideration the

Group’s overall financial position;

• Approval to allot relevant shares up to an amount equal to approximately 33% of the aggregate nominal value of the issued ordinary share

capital of the Company;

• Approval to disapply the strict statutory pre-emption provisions relating to the issue of new equity for cash until the date of the AGM to be

held in 2024, or 26 April 2024, whichever is earlier. If approved, the disapplication will be limited to the allotment of equity securities in

connection with any rights issue or any open offer to shareholders, the allotment of shares in lieu of dividends, and/or the allotment of

shares up to an aggregate nominal value equal to 5% of the nominal value of the Company’s issued share capital; and

• Authority to re-allot shares purchased by the Company and not cancelled as treasury shares. If the resolution is passed, the authority will

expire on the earlier date of the AGM in 2024 or 26 April 2024 and the minimum price at which treasury shares may be re-allotted shall be

set at the nominal value of the share where such a share is required to satisfy an obligation under an employee share scheme or, in all other

cases, an amount equal to 95% of the then market price of such shares and the maximum price at which treasury shares may be re-allotted

shall be set at 120% of the then market price of such shares.

Memorandum and Articles of Association

The Company’s Memorandum and Articles of Association set out the objects and powers of the Company. The Articles of Association detail

the rights attaching to shares, the method by which the Company’s shares can be purchased or re-issued, the provisions which apply to the

holding of and voting at general meetings and the rules relating to the Directors, including their appointment, retirement, re-election, duties

and powers. The Company’s Articles of Association may be amended by a special resolution passed by the shareholders at an AGM or EGM of

the Company. The Company’s Articles of Association were last amended at the 2021 EGM, and a copy can be obtained from the Company’s

website, www.greencore.com.

Directors’ interests in the Ordinary Shares at 30 September 2022

The interests of Directors and Group Company Secretary in the shares of the Company are set out in the Report on Directors’ Remuneration.

The Directors and Group Company Secretary have no beneficial interests in any of the Group’s subsidiary or associated undertakings.

Going concern and viability statement

The going concern and viability statements set out on pages 44 and 45 are deemed to be incorporated in this section of the Directors’ Report.

Directors’ compliance statement

The Directors acknowledge that they are responsible for securing compliance by the Company of its relevant obligations as defined in the

Companies Act 2014 (the ‘Relevant Obligations’). The Directors further confirm that there is a compliance policy statement in place setting out

the Company’s policies which, in the Directors’ opinion, are appropriate to ensure compliance with the Company’s Relevant Obligations.

The Directors also confirm that appropriate arrangements and structures are in place which, in the Directors’ opinion, are designed to secure

material compliance with the Company’s Relevant Obligations. For the year ended 30 September 2022, the Directors, with the assistance of

Internal Audit, conducted a review of the arrangements and structures in place. In discharging their responsibilities under Section 225 of the

Companies Act 2014, the Directors relied on the advice of persons who the Directors believe have the requisite knowledge and experience to

advise the Company on compliance with its Relevant Obligations.

114 Greencore Group plc Annual Report and Financial Statements 2022

Other statutory disclosures continued

Directors for year ended 30 September 2022

The names of each of the current Directors and a short biographical note on each Director appear on pages 54 and 55.

Patrick Coveney resigned as Executive Director and Chief Executive Officer (‘CEO’) on 30 March 2022 and his successor Dalton Philips was

appointed as CEO and Executive Director on 26 September 2022. Gordon Hardie stepped down from his role as a Non-Executive Director on

3 May 2022.

In accordance with the Company’s Articles of Association and Provision 18 of the Code, each of the Directors individually retire at each AGM

of the Company and, where appropriate, submit themselves for re-election. No reappointment is automatic and all Directors who intend to

submit themselves for re-election are subject to a full and rigorous evaluation. One of the main purposes of the evaluation is to assess each

Director’s suitability for re-election. If a Director is not deemed to be effective in carrying out his or her required duties, the Board will not

recommend that Director for re-election.

In line with the Code, in the year under review, each Director, and the Board as a whole, were subject to an internal evaluation. Details of the

Board evaluation can be found on pages 70 and 71.

Following on from the evaluation, the Board Chair and Board are pleased to recommend for re-election each of those Directors who intend

to seek reappointment at the forthcoming AGM as they continue to be effective and remain committed to their role on the Board.

Significant shareholdings

At 30 September 2022, the Company has been advised of the following notifiable interests in its ordinary share capital:

Shareholder

Notified

shareholding as

at 30 September

2022

Percentage of

Total Ordinary

Shares in Issue

Polaris Capital Management, LLC 67,1 19,773 12.94

FMR LLC 35,767,682 6.91

Rubric Capital Management LP 27,415,831 5.20

BlackRock, Inc. 25,300,618 4.84

Goldman Sachs Group, Inc 22,709,865 4.37

BNP Paribas Asset Management Holding S.A 20,970,205 3.98

Brandes Investment Partners, L.P. 16,442,850 3.12

Black Creek Investment Management Inc 15,834,000 3.01

At 25 November 2022, the Company has been advised of the following notifiable interests in its ordinary share capital:

Shareholder

Notified

shareholding as

at 25 November

2022

% of total

Ordinary Shares

in issue

Polaris Capital Management, LLC 67,1 19,773 13.00

Morgan Stanley & Co. International plc 41,964,145 8.15

Rubric Capital Management LP 27,415,831 5.20

FMR LLC 26,679,092 5.18

BlackRock, Inc. 25,300,618 4.84

Brandes Investment Partners, L.P. 20,712,294 4.02

Black Creek Investment Management Inc 15,834,000 3.01

Other than these holdings, the Company has not been notified as at 25 November 2022 of any interest of 3% or more in its ordinary share capital.

Accounting records

The Directors believe that they have complied with the requirements of Sections 281 to 285 of the Companies Act 2014 with regard to

maintaining adequate accounting records by employing accounting personnel with appropriate expertise and by providing adequate

resources to the Finance function. The accounting records of the Company are maintained at the Company’s registered office address at

No. 2 Northwood Avenue, Northwood Business Park, Santry, Dublin 9, D09 X5N9, Ireland.

Research and development

The Group continued its research and development programme in relation to its principal activities during the year under review.

Further information is contained in Note 3 to the Group Financial Statements.

Political contributions

The Company made no political contributions which are required to be disclosed under the Electoral Act, 1997 (as amended).

Audit and Risk Committee

The Company has an Audit and Risk Committee, the members of which are set out on page 76.

115Strategic Report | Directors’ Report | Financial Statements

Auditor

Deloitte Ireland LLP (‘Deloitte’) were appointed as external auditor in January 2019. At the AGM of the Company on 27 January 2022, under an

advisory resolution, the shareholders approved the reappointment of Deloitte as external auditor for its fourth year. Under Irish legislation, the

Company’s external auditor is automatically reappointed each year at the AGM unless the meeting passes a resolution to appoint a different

auditor or provides that the existing external auditor shall not be reappointed or, alternatively, if the auditor expresses its unwillingness to

continue in office. At the 2023 AGM, the Company intends to once again put an advisory resolution before shareholders in respect of the

continuation in office of Deloitte as external auditor.

As required under Section 381(1) (b) of the Companies Act 2014, a resolution authorising the Directors to determine the remuneration of the

external auditor will be proposed at the 2023 AGM.

Disclosure of information to the auditor

Each of the Directors individually confirm that:

• Insofar as they are aware, there is no relevant audit information of which the Company’s auditor is unaware; and

• They have taken all the steps that they ought to have taken as a Director in order to make themselves aware of any relevant audit

information and to establish that the Company’s auditor is aware of such information.

The referenced sections are deemed to be incorporated within this Directors’ Report.

On behalf of the Board

Gary Kennedy Emma Hynes

Board Chair Director

Dublin

28 November 2022

116 Greencore Group plc Annual Report and Financial Statements 2022

Statement of Directors’ Responsibilities FY22

The Directors are responsible for preparing

the Annual Report and Financial Statements

in accordance with applicable law and

regulations.

Company law requires the Directors to

prepare Financial Statements for each

financial year. Under that law the Directors

are required to prepare the Group Financial

Statements in accordance with International

Financial Reporting Standards (‘IFRS’) as

adopted by the European Union (‘EU’) and

with those parts of the Companies Act 2014

applicable to companies reporting under

IFRS. The Directors have elected to prepare

the Company Financial Statements in

accordance with FRS 101: Reduced

Disclosure Framework issued by the Financial

Reporting Council together with the

Companies Act 2014.

Under company law, Directors shall not

approve the Group and Company Financial

Statements unless they are satisfied that they

give a true and fair view of the assets,

liabilities and financial position of the Group

and Company respectively and of the

Group’s profit or loss for that financial year.

In preparing these Group and Company

Financial Statements, the Directors are

required to:

• Select suitable accounting policies and

apply them consistently;

• Make judgements and estimates that are

reasonable and prudent;

• State that the Group Financial Statements

have been prepared in accordance with

IFRS as adopted by the EU and as applied

in accordance with the Companies Act

2014 and the Company Financial

Statements have been prepared in

accordance with FRS 101 together with

the Companies Act 2014;

• Assess the Company and the Group’s

ability to continue as a going concern,

disclosing, as applicable, matters related

to going concern; and

• Prepare the Financial Statements on the

going concern basis, unless it is

inappropriate to presume that the Group

or Company will continue in business.

The Directors are also required by the

Disclosure Guidance and Transparency Rules

of the UK Financial Conduct Authority (the

‘Transparency Rules’) to include a

management report containing a fair review

of the business and a description of the

principal risks and uncertainties facing the

Group.

The Directors are responsible for keeping

adequate accounting records which disclose

with reasonable accuracy at any time the

assets, liabilities, financial position and profit

or loss of the Group and Company and

which enable them to ensure that the

Financial Statements of the Group and

Company comply with the provisions of the

Companies Act 2014. The Directors are also

responsible for taking all reasonable steps to

ensure such records are kept by the Group’s

subsidiaries which enable them to ensure

that the Financial Statements of the Group

comply with the provisions of the

Companies Act 2014. They are responsible

for such internal controls as they determine

is necessary to enable the preparation of

Financial Statements that are free from

material misstatement, whether due to fraud

or error, and have general responsibility for

safeguarding the assets of the Company and

the Group, and hence for taking reasonable

steps for the prevention and detection of

fraud and other irregularities. The Directors

are also responsible for preparing a Directors’

Report that complies with the requirements

of the Companies Act 2014.

Furthermore, the Directors are responsible

for the maintenance and integrity of

corporate and financial information included

on the Group’s website (www.greencore.

com). Legislation in Ireland concerning the

preparation and dissemination of Financial

Statements may differ from legislation in

other jurisdictions.

In accordance with the 2018 UK Corporate

Governance Code, the Directors must

provide an explanation of their responsibility

for preparing the Annual Report and

Financial Statements and state, having taken

all relevant matters into consideration,

whether they consider that the Annual

Report and Financial Statements, taken as a

whole, is fair, balanced and understandable

and provides shareholders with the

information necessary to assess the Group’s

position, performance, business model and

strategy.

The Directors confirm that they have

complied with the above requirements in

preparing the Annual Report and Financial

Statements.

Responsibility statement in regard to

Annual Report

Each of the Directors, whose names and

functions are listed on pages 54 and 55 of

this Annual Report and Financial Statements,

confirm that, to the best of each person’s

knowledge and belief:

As required by the Transparency Rules:

• The Group Financial Statements,

prepared in accordance with IFRS as

adopted by the EU and the Company

Financial Statements prepared in

accordance with FRS 101: Reduced

Disclosure Framework, give a true and fair

view of the assets, liabilities, financial

position of the Group and Company at

30 September 2022 and the profit of the

Group for the year then ended; and

• The Directors’ Report contained in this

Annual Report and Financial Statements

includes a fair review of the development

and performance of the business and the

position of the Group and Company,

together with a description of the

principal risks and uncertainties that

they face.

As required by the 2018 UK Corporate

Governance Code:

• The Annual Report and Financial

Statements, taken as a whole, is fair,

balanced and understandable and

provides the information necessary for

shareholders to assess the Group’s

position, performance, business model

and strategy.

On behalf of the Board

Gary Kennedy Emma Hynes

Board Chair Director

Dublin

28 November 2022

117Strategic Report | Directors’ Report | Financial Statements

Independent Auditor’s Report

to the members of Greencore Group plc

Report on the audit of the financial statements

Opinion on the financial statements of Greencore Group plc (the ‘Company’)

In our opinion the Group and Company financial statements:

• give a true and fair view of the assets, liabilities and financial position of the Group and the Company as at 30 September 2022 and profit of

the Group for the financial year then ended; and

• have been properly prepared in accordance with the relevant financial reporting frameworks and, in particular, with the requirements of the

Companies Act 2014.

The financial statements we have audited comprise:

The Group financial statements:

• the Group Income Statement;

• the Group Statement of Comprehensive Income;

• the Group Statement of Financial Position;

• the Group Statement of Cash Flows;

• the Group Statement of Changes in Equity; and

• the related notes 1 to 33, including a summary of significant accounting policies as set out in note 1.

The Company financial statements:

• the Company Statement of Financial Position;

• the Company Statement of Changes in Equity; and

• the related notes 1 to 10, including a summary of significant accounting policies as set out in note 1.

The relevant financial reporting framework that has been applied in the preparation of the Group financial statements is the Companies Act

2014 and International Financial Reporting Standards (IFRS) as adopted by the European Union (“the relevant financial reporting framework”).

The relevant financial reporting framework that has been applied in the preparation of the Company financial statements is the Companies

Act 2014 and FRS 101 “Reduced Disclosure Framework” issued by the Financial Reporting Council (“the relevant financial reporting

framework”).

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (Ireland) (ISAs (Ireland)) and applicable law. Our

responsibilities under those standards are described below in the “Auditor’s responsibilities for the audit of the financial statements” section of

our report.

We are independent of the Group and Company in accordance with the ethical requirements that are relevant to our audit of the financial

statements in Ireland, including the Ethical Standard issued by the Irish Auditing and Accounting Supervisory Authority, as applied to listed

entities, 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.

118 Greencore Group plc Annual Report and Financial Statements 2022

Independent Auditor’s Report continued

to the members of Greencore Group plc

Summary of our audit approach

Key Audit Matters

The Key Audit Matters that we identified in the current year were:

• Going Concern;

• Impairment of Goodwill; and

• Recoverability of Investment in Subsidiary Undertakings (Company only Key Audit Matter)

Within this report, any new Key Audit Matters are identified with

and any Key Audit Matters which are the same as

the prior year identified with .

Materiality

The materiality for the Group that we used in the current year was £3m which was determined on the basis of Net

Assets representing 0.6% of this benchmark (2021: £3m, representing 0.7% of Net Assets).

The materiality for the Company that we used in the current year was £1.65m which was determined on the basis of

Net Assets representing 0.4% of this benchmark (2021: £1.65m, representing 0.4% of Net Assets).

Scoping

We determined the scope of our Group audit by obtaining an understanding of the Group and its environment and

assessing the risks of material misstatement at the Group level.

Our audit scoping provides full scope audit coverage of 100% of revenue, and 99.8% of net assets (2021: 99.7% of

revenue and 99.8% of net assets).

Significant changes

in our approach

There are no significant changes noted in our approach compared to prior year.

Conclusions relating to going concern

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.

Our evaluation of the Directors’ assessment of the Group and Company’s ability to continue to adopt the going concern basis of accounting is

discussed in the Key Audit Matters section of our report.

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 Group and 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.

In relation to the reporting on how the Group has applied the UK Corporate Governance Code, we have nothing material to add or draw

attention to in relation to the Directors’ statement in the financial statements about whether the Directors considered it appropriate to

continue to adopt the going concern basis of accounting.

Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant sections of this report.

119Strategic Report | Directors’ Report | Financial Statements

Key Audit Matters

Key Audit Matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the

current financial year and include the most significant assessed risks of material misstatement (whether or not due to fraud) we identified,

including those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the efforts of

the engagement team.

These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we

do not provide a separate opinion on these matters.

Going Concern

Key Audit Matter description

As outlined in note 1 to the financial statements, the Group’s performance continued to be impacted by

various macro-economic factors. Uncertainty remained over the duration and ongoing impact of

COVID-19. New risks were identified in relation to potential labour shortages, supply chain disruption, the

rising impact of inflation affecting the Group’s trading environment, including recessionary pressures

potentially affecting future performance.

At the year end date, the Group is in a net current liability position of £128.7m (2021: £135.9m) and the

Group had borrowings of £279.6m (2021: £302.2m) (Note 20). At the year end date, the Company is in a net

current liability position of £402.8m (2021: £389.0m).

The Group is required to meet specific debt covenants (which include EBITDA/net debt ratios). Compliance

with these debt covenants is dependent on the achievement of projected net cash inflows.

There is a risk that the Group may not be able to comply with the debt covenants requirements if sufficient

cashflows are not generated, which may impact the ability of the Group and Company to continue as a

going concern.

Because of the significance of the assumptions and judgements exercised in these cash flow scenarios

prepared by management, we have considered this as a Key Audit Matter.

The Audit and Risk committee discussion of this Key Audit Matter is set out on page 79.

How the scope of our audit

responded to the Key Audit

Matter

In order to address the Key Audit Matter, our procedures included the following:

We evaluated the design and determined the implementation of the relevant controls in place over the

Directors’ review of the going concern cash flow projections and various scenarios.

We read the amendments to the Group’s financing agreements and obtained an understanding of the debt

covenants applicable to the Group and the respective impact going forward in the going concern cash flow

projections.

We challenged the Director’s assumptions used in their going concern assessment, the basis for their

evaluation and inclusion of sensitivities to incorporate the risks and uncertainties related to macro-

economic factors such as any potential continued impact of COVID-19, supply chain disruption, labour

challenges, inflationary pressures, and climate risk on future trading.

We have evaluated the Director’s assessment of the risks and uncertainties related to macro-economic

factors and the adequacy of disclosures in relation to the specific risks these pose.

We performed sensitivity analysis using alternative reasonably possible assumptions, including potential for

renewed COVID-19 restrictions and other market trading challenges such as inflation and recessionary

pressure. We compared outputs from the Group’s cash flow projections and from our sensitivity analysis to

the Directors’ proforma covenant compliance calculations.

We evaluated the completeness and accuracy of the disclosures made in the Basis of Preparation in Note 1

by reference to the understanding we had obtained of the Group’s financial performance during 2022, our

assessment of Directors’ cash flow projections and our reading of the Group’s financing agreements.

Key observations

We have concluded that the adoption of the going concern basis and the related disclosures are

appropriate. We have no observations that impact our audit in respect of the adoption of the going concern

basis or the related disclosures. Please refer to our conclusions in the Going Concern section of our report.

120 Greencore Group plc Annual Report and Financial Statements 2022

Impairment of Goodwill

Key Audit Matter description

As stated in Note 12 (Goodwill and Intangible Assets), the Group held £449.4m (2021: £449.4m) of goodwill

as at 30 September 2022 which represents 33.6% of the Group’s total assets. The accounting policies in

relation to Goodwill are described in Note 1 (Significant Sources of Accounting Estimates) to the financial

statements.

Directors’ judgement is required in identifying indicators of impairment, and estimation is required in

determining the recoverable amount of the Group’s cash generating units (“CGU’s”). There is a risk that an

impairment of goodwill has arisen which has not been appropriately identified. As a result, the balances

could be overstated on the Statement of Financial Position at year end due to the use of inappropriate

inputs and assumptions within the impairment model, in particular the discount rate and long- term growth

rate. This risk mainly relates to one of the Groups two CGU’s, Convenience Foods UK as it accounts for 99%

of the Group’s goodwill balance.

When a review for impairment is carried out, the recoverable amount of the CGU is compared to its

carrying value. The recoverable amount is determined based on value in use calculations which rely on

Directors’ assumptions and estimates of future trading performance. These assumptions and estimates may

be impacted by new risks and uncertainties arising from the Russia- Ukraine Conflict, and other macro-

economic factors such as supply chain disruption, labour challenges, inflationary and recessionary

pressures, resulting in reduced headroom and potentially impairment in the carrying value of goodwill.

The key assumptions utilised by the Directors in the impairment reviews are discount rates and long term

growth rate. A small change in these specific assumptions could have a significant impact on the value in

use calculation, therefore this is considered a Key Audit Matter.

The Audit and Risk committee’s discussion of this Key Audit Matter is set out on page 79.

How the scope of our audit

responded to the Key Audit

Matter

In order to address the Key Audit Matter, our procedures included the following:

We evaluated the design and determined the implementation of the relevant controls in place over the

Directors’ impairment review process.

We, in conjunction with our valuation specialists, evaluated the methodology applied by the Directors in

preparing the value in use calculations and the judgements applied in determining the CGU.

We challenged the underlying key assumptions within the Group’s impairment model, focusing on the

implicit discount rates and profitability growth rates. We challenged the Group’s scenarios with reference to

recent performance, economic and industry forecasts and trend analysis including historic growth rates

and market available information.

We also challenged the cash flow projections by comparing them to historic rates and Group strategic

plans.

We assessed the reasonableness of related assumptions used in determining terminal values.

We developed an independent view of the key assumptions used in the model, in particular, the Group

discount rate and long term growth rate, and benchmarked the rates used by Directors against market data

and comparable organisations. We also assessed any changes made to the impairment model when

calculating the headroom available.

We evaluated the Directors’ sensitivity analysis and performed our own sensitivity analysis on the key

assumptions used.

We evaluated the completeness and accuracy of the disclosures in relation to goodwill and whether they

meet the requirements of the relevant accounting standards.

Key observations

We have no observations that impact our audit in respect of the amounts and disclosures related to the

carrying value of goodwill.

Independent Auditor’s Report continued

to the members of Greencore Group plc

121Strategic Report | Directors’ Report | Financial Statements

Recoverability of Investment in Subsidiary Undertakings (Company only Key Audit Matter)

Key Audit Matter description

As outlined in Note 1 (Significant Accounting Judgements) to the Company financial statements,

investments in subsidiary undertakings are carried at cost less impairment. Investment in subsidiary

undertakings is significant and represents 99% of total assets recorded on the Company Statement of

Financial Position.

Impairments in subsidiary undertakings are determined with reference to the individual subsidiary

undertakings’ recoverable value, which could have been adversely effected by the current environment.

Directors’ judgements around valuation of investments in subsidiaries are considered significant

judgements given the magnitude of the investments on the Company Statement of Financial Position.

With limited headroom, changes in judgements resulting in reduced recoverable value, could result

in material impairment in the Company income statement.

Given the significant judgement involved in assessing the recoverable value of the investments held in

subsidiary undertakings, we have considered this to be a Key Audit Matter at the Company level.

The Audit and Risk committee’s discussion of this Key Audit Matter is set out on page 79.

How the scope of our audit

responded to the Key Audit

Matter

In order to address the Key Audit Matter, our procedures included the following:

We evaluated the design and determined the implementation of the relevant controls in place over the

Directors’ impairment review process.

We assessed the recoverable value of subsidiary undertakings for any objective indicators of impairment

and tested the accuracy of Directors’ calculations.

We confirmed that the Directors used the most up to date financial information in their valuation models

and assessed the reasonableness of the assumptions made in determining the recoverable amount of their

investment in subsidiaries.

Key observations

We have no observations that impact our audit in respect of the recoverability of investment in subsidiary

undertakings.

Our audit procedures relating to these matters were designed in the context of our audit of the financial statements as a whole, and not to

express an opinion on individual accounts or disclosures. Our opinion on the financial statements is not modified with respect to any of the

risks described above, and we do not express an opinion on these individual matters.

Our application of materiality

We define materiality as the magnitude of misstatement that makes it probable that the economic decisions of a reasonably knowledgeable

person, relying on the financial statements, would be changed or influenced. We use materiality both in planning the scope of our audit work

and in evaluating the results of our work.

We determined materiality for the Group to be £3.0m (2021: £3.0m) which is approximately 0.6% of Net Assets (2021: 0.7% of Net Assets). We

considered Net Assets to be the critical component for determining materiality because it represents the cumulative undistributed gains and

capital and reserves of the Group. In determining materiality, we considered the improvements in profitability, and the increase in the net asset

position of the Group since last year. However, given the additional uncertainties relating to potential impacts of the Russia – Ukraine conflict,

supply chain issues and inflationary pressures, we have considered that remaining at a stable level of Group materiality was most appropriate.

We determined materiality for the Company to be £1.65m (2021: £1.65m) which is approximately 0.4% of Net Assets (2021: 0.4% of Net Assets).

We considered Net Assets to be the critical component for determining materiality because the Company is a non-trading company, itdoes

not generate revenues but incurs costs. Net Assets are of most relevance to the users of the financial statements. Given the additional

uncertainties relating to potential impacts of the Russia – Ukraine conflict, supply chain issues and inflationary pressures, we considered that

remaining at a stable level of the Company materiality was most appropriate.

Net Assets

Materiality

£3m

Audit Committee

reporting threshol

£0.15m

t Assets

£465.6m

122 Greencore Group plc Annual Report and Financial Statements 2022

We set performance materiality at a level lower than materiality to reduce the probability that, in aggregate, uncorrected and undetected

misstatements exceed the materiality for the financial statements as a whole. Performance materiality was set at 80% of materiality for the

Group and Company for the 2022 audit. In determining performance materiality, we considered the following factors:

a. our understanding of the entity and its environment and the impact of various macro-economic factors arising from the Russia – Ukraine conflict;

b. the improvements in financial performance of the Group and Company since last year;

c. uncertainty of the duration and ongoing impact of COVID-19 as well as new risks identified in relation to potential labour shortages, supply

chain disruption and the rising impact of inflation affecting the trading environment;

d. the nature, volume, and size of misstatements (corrected and uncorrected) in the previous audit; and

e. the likelihood of the prior year misstatements to reoccur in current year audit.

We agreed with the Audit Committee that we would report to them any audit differences in excess of £0.15m, as well as differences below

that threshold which, in our view, warranted reporting on qualitative grounds. We also report to the Audit Committee on disclosure matters

that we identified when assessing the overall presentation of the financial statements.

An overview of the scope of our audit

We determined the scope of our Group audit by obtaining an understanding of the Group and its environment, including Group-wide

controls, and assessing the risks of material misstatement at the Group level. We also considered the impact of the IT security incident (as

disclosed in Note 3 to the financial statements) on our scope and audit approach. Based on that assessment, we focused our Group audit

scope primarily on the audit of 9 trading components which were subject to a full scope audit and 16 non-trading, investment holding or

financing components which were subject to specified audit procedures where the extent of our testing was based on our assessment of the

associated risks of material misstatement and of the materiality of the component operations to the Group. The remaining components of the

Group were subject to analytical procedures.

These components were selected based on the level of coverage achieved and to provide an appropriate basis for undertaking audit work to

address the risks of material misstatement identified above. Our audit work for all components was executed at levels of materiality applicable

to each individual component which were lower than Group materiality and ranged from £0.9m to £2.1m.

At the Group level, we also tested the consolidation process and carried out analytical procedures to confirm our conclusion that there were

no significant risks of material misstatement of the aggregated financial information of the remaining components not subject to a full audit.

100%

22%

0.2%

77.8%

Net Assets

Full Scope Audits

Specified Audit

Procedures

Analytical Procedures

Full Scope Audits

Specified Audit

Procedures

Analytical Procedures

Revenue

Revenue Net Assets

Full Scope Audits 100% 77.8%

Specified Audit Procedures – 22.0%

Analytical Procedures – 0.2%

During the year, the Group audit team, while adopting a hybrid approach of in-person and virtual meetings, attended planning meetings

at a number of significant and non-significant component locations in all key locations. In addition to attending planning meetings, we sent

detailed instructions to our component audit teams, included them in our team briefings, discussed their risk assessment, attended client

planning and closing meetings, and reviewed their audit working papers.

Other information

The other information comprises the information included in the Annual Report and Financial Statements, other than the financial statements and

our auditor’s report thereon. The Directors are responsible for the other information contained within the Annual Report and Financial Statements.

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 audit or otherwise appears to be materially misstated. If we identify such material

inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial

statements or a material misstatement of the other information. 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.

Independent Auditor’s Report continued

to the members of Greencore Group plc

123Strategic Report | Directors’ Report | Financial Statements

Responsibilities of Directors

As explained more fully in the Statement of Directors’ Responsibilities, the Directors are responsible for the preparation of the financial

statements and for being satisfied that they give a true and fair view and otherwise comply with the Companies Act 2014, and for such internal

control as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatement,

whether due to fraud or error.

In preparing the financial statements, the Directors are responsible for assessing the Group and Company’s ability to continue as a going

concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors

either intend to liquidate the Group or Company or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

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 auditor’s 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 (Ireland) 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.

A further description of our responsibilities for the audit of the financial statements is located on IAASA’s website at:

http://www.iaasa.ie/getmedia/b2389013-1cf6-458b-9b8f-a98202dc9c3a/Description_of_auditors_responsibilities_for_audit.pdfr.

This description forms part of our auditor’s report.

Extent to which the audit was considered capable of detecting irregularities, including fraud

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.

Identifying and assessing potential risks related to irregularities

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with laws and

regulations, we considered the following:

• the nature of the industry and sector, control environment and business performance including the design of the Group and Company’s

remuneration policies, key drivers for Directors’ remuneration, bonus levels and performance targets;

• results of our enquiries of management including legal department, Corporate secretary and the Audit and Risk Committee about their

own identification and assessment of the risks of irregularities;

• any matters we identified having obtained and reviewed the Group and Company’s documentation of their policies and procedures

relating to:

– identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of non-compliance;

– detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;

– the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;

• the matters discussed among the audit engagement team, component audit teams and relevant internal specialists, including tax,

valuations, pensions and IT regarding how and where fraud might occur in the financial statements and any potential indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and identified

the greatest potential for fraud in the area of revenue recognition (rebates and discounts). In common with all audits under ISAs (Ireland), we

are also required to perform specific procedures to respond to the risk of management override.

We also obtained an understanding of the legal and regulatory framework that the Group and Company operates in, focusing on provisions

of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial statements.

The key laws and regulations we considered in this context included the Companies Act 2014, UK Corporate Governance Code 2018, Listing

Rules, Irish tax laws and UK tax laws.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements but compliance

with which may be fundamental to the Group and Company’s ability to operate or to avoid a material penalty. These included the Group and

the Company’s operating license and environmental regulations.

Audit response to risks identified

As a result of performing the above, we did not identify any Key Audit Matters related to the potential risk of fraud or non-compliance with

laws and regulations.

Our procedures to respond to risks identified included the following:

• reviewing the financial statements disclosures and testing to supporting documentation to assess compliance with provisions of relevant

laws and regulations described as having a direct effect on the financial statements;

• enquiring of management, the Audit and Risk Committee and in-house and external legal counsel concerning actual and potential litigation

and claims;

• performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material misstatement due

to fraud;

• reading minutes of meetings of those charged with governance and reviewing internal audit reports;

124 Greencore Group plc Annual Report and Financial Statements 2022

• in addressing the presumed risk of fraud in revenue recognition (rebates and discounts), our procedures included:

– we obtained an understanding of and assessed the relevant controls in place over the various selling and rebate arrangements within

the Group;

– we obtained reconciliations showing movements on rebates and discounts during the year. On a sample basis, we agreed a number

of rebates and discounts for the year to customer agreements and assessed whether there were any material one off or unusual

transactions during the year;

– we considered material adjustments and negotiations which occurred during the year and reviewed the accounting treatment to ensure

compliance with the requirements of IFRS 15.

• in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and other

adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias; and evaluating

the business rationale of any significant transactions that are unusual or outside the normal course of business.

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members including internal

specialists and component audit teams, and remained alert to any indications of fraud or non-compliance with laws and regulations

throughout the audit.

Report on other legal and regulatory requirements

Opinion on other matters prescribed by the Companies Act 2014

Based solely on the work undertaken in the course of the audit, we report that:

• We have obtained all the information and explanations which we consider necessary for the purposes of our audit.

• In our opinion the accounting records of the Company were sufficient to permit the financial statements to be readily and properly audited.

• The Company Statement of Financial Position is in agreement with the accounting records.

• In our opinion the information given in the Directors’ Report is consistent with the financial statements and the Directors’ Report, and has

been prepared in accordance with the Companies Act 2014.

Corporate Governance Statement

The Listing Rules and ISAs (Ireland) require us to review the Directors’ statement in relation to going concern, longer-term viability and the part

of the Corporate Governance Statement relating to the Group’s compliance with the provisions of the UK Corporate Governance Code and

Irish Corporate Governance Annex specified for our review.

Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the Corporate Governance

Statement is materially consistent with the financial statements and our knowledge obtained during the audit:

• the Directors’ statement with regards the appropriateness of adopting the going concern basis of accounting and any material

uncertainties identified set out on page 113;

• the Directors’ explanation as to its assessment of the Group’s prospects, the period this assessment covers and why the period is

appropriate set out on page 113;

• the Directors’ statement on fair, balanced and understandable set out on page 116;

• the board’s confirmation that it has carried out a robust assessment of the emerging and principal risks and the disclosures in the annual

report that describe the principal risks and the procedures in place to identify emerging risks and an explanation of how they are being

managed or mitigated set out on page 109;

• the section of the annual report that describes the review of effectiveness of risk management and internal control systems set out on

page 77; and

• the section describing the work of the Audit and Risk Committee set out on page 76 to 82.

Matters on which we are required to report by exception

Based on the knowledge and understanding of the Group and the Company and its environment obtained in the course of the audit,

we have not identified material misstatements in the Directors’ Report.

We have nothing to report in respect of the provisions in the Companies Act 2014 which require us to report to you if, in our opinion,

the disclosures of Directors’ remuneration and transactions specified by law are not made.

Use of our report

This report is made solely to the Company’s members, as a body, in accordance with Section 391 of the Companies Act 2014. 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 auditor’s

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.

Kevin Sheehan

For and on behalf of Deloitte Ireland LLP

Chartered Accountants and Statutory Audit Firm

Deloitte & Touche House, Earlsfort Terrace, Dublin 2

28 November 2022

Independent Auditor’s Report continued

to the members of Greencore Group plc

Notes: An audit does not provide assurance on the maintenance and integrity of the website, including controls used to achieve this, and in

particular on whether any changes may have occurred to the financial statements since first published. These matters are the responsibility

of the directors but no control procedures can provide absolute assurance in this area.

Legislation in Ireland governing the preparation and dissemination of financial statements differs from legislation in other jurisdictions.

125Strategic Report | Directors’ Report | Financial Statements

Group Income Statement

year ended 30 September 2022

2022* 2021

Notes

Pre-exceptional

£m

Exceptional

(Note 7)

£m

Total

£m

Pre-exceptional

£m

Exceptional

(Note 7)

£m

Total

£m

Revenue 2 1 ,7 39.6 – 1 ,739. 6 1 , 324 . 8 – 1 , 3 24 . 8

Cost of sales (1 , 216.6) – (1 , 216.6) (90 1 .9) – (90 1 .9)

Gross profit 523.0 – 52 3.0 422.9 – 42 2.9

Operating costs before acquisition

related amortisation 3 (4 49.6) (16 .5) (46 6 . 1) (383. 3) 7. 7 (375 .6)

Impairment of trade receivables 22 (1. 2) – (1 . 2) (0.6) – (0.6)

Group operating profit before

acquisition related amortisation 72.2 (16 .5) 55.7 39.0 7. 7 46.7

Amortisation of acquisition related

intangibles (3.6) – (3.6) (3 .9) – (3.9)

Group operating profit 68.6 (16. 5) 52 .1 35 .1 7. 7 42.8

Finance income 8 0.2 – 0.2 0. 1 – 0.1

Finance costs 8 (12 .5) – (1 2 .5) (19. 1) – (1 9. 1)

Profit on disposal of associates 28 – – – – 4.0 4.0

Profit/(loss) before taxation 56. 3 (16. 5) 39.8 16. 1 11 .7 2 7. 8

Taxation 9 (10. 5) 3.0 (7. 5) (2 .5) 0.4 (2 .1)

Profit/(loss) for the financial year 45. 8 (13 .5) 32. 3 1 3.6 12. 1 2 5.7

Attributable to:

Equity shareholders 45 .8 (1 3. 5) 32. 3 13.3 12.1 25.4

Non-controlling interests 28 – – – 0. 3 – 0. 3

45. 8 (13 .5) 32. 3 13 .6 12.1 25.7

Earnings per share (pence)

Basic earnings per share 10 6.2 5.0

Diluted earnings per share 10 6.1 5.0

* The financial year is the 53 week period ended 30 September 2022 with comparatives for the 52 week period ended 24 September 2021

126 Greencore Group plc Annual Report and Financial Statements 2022

Notes

2022*

£m

2021

£m

Items of comprehensive income taken directly to equity

Items that will not be reclassified to profit or loss:

Actuarial gain on Group legacy defined benefit pension schemes 5 14.4 36.3

Tax charge on Group legacy defined benefit pension schemes 9 (4. 1) (1 .1)

10. 3 35. 2

Items that may subsequently be reclassified to profit or loss:

Currency translation adjustment 1 .8 (3. 2)

Translation reserve transferred to income statement on disposal of subsidiary – (1 .0)

Non-controlling interest transferred to Income Statement on disposal of subsidiary – (5.8)

Cash flow hedges:

fair value movement taken to equity 8.5 (0. 5)

transferred to Income Statement (1 .6) 1.2

8.7 (9. 3)

Other comprehensive income for the financial year 19.0 25 .9

Profit for the financial year 32 .3 25 .7

Total comprehensive income for the financial year 51 . 3 51 . 6

Attributable to:

Equity shareholders 51 . 3 5 7. 3

Non-controlling interests – (5 .7)

Total comprehensive income for the financial year 51 . 3 51 . 6

* The financial year is the 53 week period ended 30 September 2022 with comparatives for the 52 week period ended 24 September 2021

Group Statement of Comprehensive Income

year ended 30 September 2022

127Strategic Report | Directors’ Report | Financial Statements

Group Statement of Financial Position

at 30 September 2022

Notes

2022

£m

2021

£m

ASSETS

Non-current assets

Goodwill and intangible assets 12 468.1 47 3 . 3

Property, plant and equipment 13 319. 4 3 0 7. 4

Right-of-use assets 14 44.4 54. 1

Investment property 15 3.1 3.0

Retirement benefit assets 24 3 9.8 42. 1

Derivative financial instruments 21 12 .4 –

Deferred tax assets 9 3 7. 1 48. 1

Trade and other receivables 0.3 0.4

Total non-current assets 924. 6 928 .4

Current assets

Inventories 16 63. 3 4 7. 7

Trade and other receivables 17 248 .7 196. 3

Cash and cash equivalents 19 99. 6 1 19. 1

Derivative financial instruments 21 2 .5 –

Total current assets 414 . 1 363 .1

Total assets 1 ,33 8.7 1 , 291 .5

EQUITY

Capital and reserves attributable to equity holders of the Company

Share capital 25 5. 2 5.3

Share premium 89. 7 89. 7

Reserves 370.7 328. 2

Total equity 465.6 423 . 2

LIABILITIES

Non-current liabilities

Borrowings 20 20 9.8 20 9.1

Lease liabilities 14 33. 6 42 .0

Other payables 18 2 .7 3.7

Derivative financial instruments 21 – 2.7

Provisions 23 5.2 5.5

Retirement benefit obligations 24 60. 1 88 .1

Deferred tax liabilities 9 18.9 18 .2

Total non-current liabilities 330. 3 3 69. 3

Current liabilities

Borrowings 20 69. 8 93 . 1

Trade and other payables 18 445. 1 375. 8

Lease liabilities 14 14.4 1 7. 6

Derivative financial instruments 21 0. 1 2.9

Provisions 23 4.7 2.1

Current tax payable 8.7 7. 5

Total current liabilities 542 .8 499. 0

Total liabilities 873. 1 868. 3

Total equity and liabilities 1 , 338. 7 1 ,291 . 5

On behalf of the Board

Gary Kennedy Emma Hynes

Director Director

128 Greencore Group plc Annual Report and Financial Statements 2022

Notes

2022*

£m

2021

£m

Profit before taxation 39. 8 2 7. 8

Finance income 8 (0. 2) (0.1)

Finance costs 8 12. 5 19. 1

Exceptional items 7 16 .5 (1 1.7)

Group operating profit before exceptional items 68.6 35 .1

Depreciation and impairment of property, plant and equipment and right-of-use assets 13, 14 52 .5 54.6

Amortisation of intangible assets 12 6 .7 7. 0

Employee share-based payment expense 2 .7 2.1

Contributions to Group legacy defined benefit pension scheme 24 (1 1 . 5) (7 .0)

Working capital movement 26 2 .0 33. 2

Net cash inflow from operating activities before exceptional items 121 .0 1 25.0

Cash outflow related to exceptional items 7 (13.6) (3. 3)

Interest paid (including lease liability interest) (16.7) (18.8)

Tax received/(paid) 2.2 (0. 2)

Net cash inflow from operating activities 92.9 102 .7

Cash flow from investing activities

Purchase of property, plant and equipment (48 .6) (3 7. 1)

Purchase of intangible assets (1 .4) (3.1)

Disposal of undertakings 28 – 16. 3

Disposal of investment property 15 – 6. 3

Net cash outflow from investing activities (50.0) (1 7. 6)

Cash flow from financing activities

Proceeds from issue of shares (net of transaction costs) – 8 7. 1

Ordinary Shares purchased – own shares (3.0) –

Capital return via share buyback (8. 8) –

Drawdown/(repayment) of bank borrowings 22 9.6 (1 3 0.9)

Repayment of Private Placement Notes 22 (4 7. 3) –

Settlement of swaps on maturity of Private Placement Notes (2 .6) –

Repayment of lease liabilities 14 (1 7. 3) (1 4.3)

Net cash outflow from financing activities (69. 4) (58. 1)

Net (decrease)/increase in cash and cash equivalents and bank overdrafts (26. 5) 2 7. 0

Reconciliation of opening to closing cash and cash equivalents and bank overdrafts

Cash and cash equivalents and bank overdrafts at beginning of year 19 73.6 4 7. 0

Translation adjustment (0.4) (0.4)

Net (decrease)/increase in cash and cash equivalents and bank overdrafts (26. 5) 2 7. 0

Cash and cash equivalents and bank overdrafts at end of year 19 46.7 73 .6

* The financial year is the 53 week period ended 30 September 2022 with comparatives for the 52 week period ended 24 September 2021

Group Statement of Cash Flows

year ended 30 September 2022

129Strategic Report | Directors’ Report | Financial Statements

Group Statement of Changes in Equity

year ended 30 September 2022

capital

£m

premium

£m

Other

reserves

£m

Retained

earnings

£m

Total

equity

£m

At 24 September 2021 5.3 89. 7 1 21 .4 206.8 423. 2

Items of income and expense taken directly to equity

Actuarial gain on Group legacy defined benefit pension schemes – – – 14 .4 14.4

Tax credit on Group legacy defined benefit pension schemes – – – (4. 1) (4. 1)

Currency translation adjustment – – 1.8 – 1. 8

Cash flow hedge fair value movement taken to equity – – 8. 5 – 8.5

Cash flow hedge transferred to income statement – – (1 .6) – (1 .6)

Profit for the financial year – – – 32 . 3 32 . 3

Total comprehensive income for the financial year – – 8.7 42 .6 51 . 3

Transactions with equity holders of the Company

Employee share-based payments expense – – 3.0 – 3.0

Tax on share-based payments – – – (0.1) (0. 1)

Exercise, lapse or forfeit of share-based payments – – (2 .8) 2 .8 –

Shares acquired by Employee Benefit Trust

(A)

– – (3 .0) – (3.0)

Transfer to retained earnings on grant of shares to beneficiaries of the

Employee Benefit Trust

(B)

– – 0.4 (0.4) –

Capital return via share buyback

(C)

(0. 1) – 0. 1 (8 .8) (8.8)

At 30 September 2022 5.2 89.7 1 2 7. 8 242 .9 465 .6

capital

£m

premium

£m

Other

reserves

£m

Retained

earnings

£m

Total

£m

Non-

controlling

interests

£m

Total

equity

£m

At 25 September 2020 4. 5 0.4 1 2 3.9 1 4 7. 7 276 . 5 5.7 282. 2

Items of income and expense taken directly to equity

Actuarial gain on Group legacy defined benefit pension

schemes – – – 36 .3 36. 3 – 36. 3

Tax credit on Group legacy defined benefit pension

schemes – – – (1 .1) (1 .1) – (1 . 1)

Currency translation adjustment – – (3.0) – (3.0) (0.2) (3. 2)

Translation reserve transferred to Income Statement on

disposal of subsidiary – – (1.0) – (1 .0) – (1 .0)

Non-controlling interest transferred to Income Statement

on disposal of subsidiary – – – – – (5. 8) (5.8)

Cash flow hedge fair value movement taken to equity – – (0.5) – (0. 5) – (0.5)

Cash flow hedge transferred to income statement – – 1.2 – 1.2 – 1.2

Profit for the financial year – – – 25 .4 25.4 0. 3 25 .7

Total comprehensive income for the financial year – – (3.3) 60.6 5 7. 3 (5.7) 51 .6

Transactions with equity holders of the Company

Employee share-based payments expense – – 2.1 – 2.1 – 2. 1

Tax on share-based payments – – – 0. 2 0. 2 – 0.2

Exercise, lapse or forfeit of share-based payments – 0. 1 (2.4) 2.4 0.1 – 0.1

Transfer to retained earnings on grant of shares to

beneficiaries of the Employee Benefit Trust

(B)

– – 1.1 (1 .1) – – –

Shares issued in the year 0.8 8 9. 2 – – 90.0 – 90.0

Transaction costs of share issue – – – (3.0) (3.0) – (3.0)

At 24 September 2021 5.3 8 9.7 1 21.4 2 06.8 42 3. 2 – 423 . 2

130 Greencore Group plc Annual Report and Financial Statements 2022

Other reserves

Share-

based

payment

reserve

(D)

£m

Own

(E)

£m

Undenominated

capital reserve

(F)

£m

Hedging

reserve

(G)

£m

Foreign

currency

translation

reserve

(H)

£m

Total

£m

At 24 September 2021 3.6 (1 .8) 120.4 1. 2 (2 .0) 121 .4

Items of income and expense taken directly to equity

Currency translation adjustment – – – – 1 .8 1.8

Cash flow hedge fair value movement taken to equity – – – 8.5 – 8.5

Cash flow hedge transferred to Income Statement – – – (1 .6) – (1 .6)

Total recognised income and expense for the financial year – – – 6.9 1. 8 8.7

Transactions with equity holders of the Company

Employee share-based payments expense 3 .0 – – – – 3 .0

Exercise, lapse or forfeit of share options (2 .8) – – – – (2 .8)

Shares acquired by Employee Benefit Trust

(A)

– (3.0) – – – (3.0)

Transfer to retained earnings on grant of shares to beneficiaries

of the Employee Benefit Trust

(B)

– 0.4 – – – 0. 4

Capital return via share buyback

(C)

– – 0.1 – – 0.1

At 30 September 2022 3.8 (4 .4) 120. 5 8. 1 (0. 2) 1 2 7. 8

Share-

based

payment

reserve

(D)

£m

Own

(E)

£m

Undenominated

capital reserve

(F)

£m

Hedging

reserve

(G)

£m

Foreign

currency

translation

reserve

(H)

£m

Total

£m

At 25 September 2020 3.9 (2.9) 120.4 0.5 2.0 12 3 .9

Items of income and expense taken directly to equity

Currency translation adjustment – – – – (3.0) (3 .0)

Translation reserve transferred to Income Statement on disposal

of subsidiary – – – – (1 .0) (1 .0)

Cash flow hedge fair value movement taken to equity – – – (0. 5) – (0. 5)

Cash flow hedge transferred to Income Statement – – – 1.2 – 1.2

Total recognised income and expense for the financial year – – – 0.7 (4.0) (3. 3)

Transactions with equity holders of the Company

Employee share-based payments expense 2.1 – – – – 2.1

Exercise, lapse or forfeit of share options (2.4) – – – – (2. 4)

Transfer to retained earnings on grant of shares to beneficiaries

of the Employee Benefit Trust

(B)

– 1 .1 – – – 1.1

At 24 September 2021 3 .6 (1 .8) 120.4 1.2 (2.0) 1 21 .4

(A) Pursuant to the terms of the Employee Benefit Trust 2,180,216 shares (2021: Nil) were purchased during the financial year ended 30 September 2022 for a cash cost of £3 .0m

(2021: £Nil).

(B) During the year, 290,044 (2021: 688,851) shares with a nominal value at the date of transfer of £0.0 029m (2021: £0.0 069m) at a cost of £0.4m (2021: £1 .1m) were

transferred to beneficiaries of the Annual Bonus Plan.

(C) During the year, the Company, Greencore Group plc purchased and subsequently cancelled 9,728,677 Ordinary Shares for a total cash cost of £8.8m as part of the share

buyback programme.

(D) The share-based payment reserve relates to equity settled share-based payments made to employees through the Performance Share Plan, the Annual Bonus Plan, the

ShareSave Scheme and Employee Incentive Scheme. Further information in relation to these share-based payment schemes is set out in Note 6.

(E) The amount included as own shares relates to Ordinary Shares in Greencore Group plc which are held in trust. The shares held in trust are granted to beneficiaries of the

Group’s employee share based payment scheme when the relevant conditions of the scheme are satisfied.

(F) The undenominated capital reserve represents the nominal cost of cancelled shares and the amount transferred to reserves as a result of renominalising the share capital

of Greencore Group plc on conversion to the euro.

(G) The hedging reserve represents the effective portion of gains or losses on hedging instruments from the application of cash flow hedge accounting for which the

underlying hedged transaction is not impacting profit or loss. The cumulative deferred gain or loss on the hedging instrument is reclassified to profit or loss only when

the hedged transaction is no longer expected to occur.

(H) The foreign currency translation reserve reflects the exchange difference arising from the translation of the net investments in foreign operations and on borrowings and

other currency instruments designated as hedges of such investments which are taken to equity. When a foreign operation is sold, exchange differences that are

recorded in equity are recognised in the Group Income Statement as part of the gain or loss on sale.

Group Statement of Changes in Equity continued

year ended 30 September 2022

131Strategic Report | Directors’ Report | Financial Statements

1. Group Statement of accounting policies

General information

Greencore Group plc (‘the Company’), registered number 170116, together with its subsidiaries (‘the Group’) is a manufacturer of convenience

foods in the U.K. The Company is a public limited company incorporated and domiciled in the Republic of Ireland and the Company’s shares

are publicly traded on the London Stock Exchange. The address of its registered office is 2 Northwood Avenue, Northwood Business Park,

Santry, Dublin 9, Ireland, D09 X5N9.

Statement of compliance

The Group Financial Statements of Greencore Group plc have been prepared in accordance with International Financial Reporting Standards

(‘IFRS’) and their interpretations approved by the International Accounting Standards Board (‘IASB’) as adopted by the European Union (‘EU’)

and those parts of the Companies Act 2014, applicable to companies reporting under IFRS.

Basis of preparation

The Group Financial Statements, which are presented in sterling and rounded to the nearest million (unless otherwise stated), have been

prepared on a going concern basis under the historical cost convention, except where assets and liabilities are stated at fair value in

accordance with relevant accounting policies.

The accounting policies applied in the preparation of the Group Financial Statements for the year ended 30 September 2022 have been

applied consistently by the Group and have been consistently applied to all years presented, unless otherwise stated.

The Group Financial Statements are prepared to the Friday nearest to 30 September. Accordingly, these Financial Statements are prepared for

the 53 week period ended 30 September 2022 (‘financial year’). Comparatives are for the 52 week period ended 24 September 2021. The

Statement of Financial Positions for 2022 and 2021 have been prepared as at 30 September 2022 and 24 September 2021 respectively.

The loss attributable to equity shareholders dealt with in the Financial Statements of the Parent Company was £4.8m (2021: loss of £25.3m).

In accordance with Section 304 of the Companies Act 2014, the Company is availing of the exemption from presenting its individual profit

and loss account, which forms part of the approved Financial Statements, to the Annual General Meeting and from filing it with the Registrar

of Companies.

Going concern

The Directors, after making enquiries, have a reasonable expectation that the Group has adequate resources to continue operating as a going

concern for the foreseeable future.

In the current period, the UK trading environment, especially in food to go categories, was resilient notwithstanding some demand volatility

caused by COVID-19 related mobility restrictions in H1 22 and the increasing impact of inflation on the UK consumer during H2 22.

Notwithstanding the inflationary challenges impacting the broader UK food industry at present, there has been limited demand impact to date

in the Group’s categories. The Group also continues to monitor the potential impact of a recessionary environment and cost of living factors

on consumer spending through the year end.

Accordingly, the Directors have considered a number of scenarios for the next 18 months from the year end date. These scenarios consider

the potential impact of a recessionary environment including the impact of inflation and interest rates on consumer spending, along with

consideration of under recovery of inflation, supply chain disruption issues and further one off future events linked to a reduction in consumer

footfall during the winter months. The Group is satisfied that there is sufficient headroom in the financial covenants under current facilities

under each scenario.

The Group’s scenarios assume:

• A base case projection using internally approved forecast and strategic plans, which reflect the external economic environment. These

plans incorporate the potential impact of climate change on the Group’s capital investment process;

• A downside scenario which assesses the potential impact of a recessionary environment including the impact of inflation and interest rates

on consumer spending, along with consideration of under recovery of inflation and further one off future events linked to a reduction in

consumer footfall during the winter months; and

• A severe downside scenario which assesses the further impact of inflation under recovery, along with a further reduction in sales to reflect

the impact of changes in consumer spending through any recessionary period. In this scenario, mitigating actions are assumed including

a reduction in non-business critical capital expenditure and reductions in the amount of the share buyback plan.

While the Group is in a net current liability position of £128.7m (2021: £135.9m) at the 30 September 2022, the Group retained financial

strength and flexibility as at the end of FY22. The Group had cash and undrawn committed bank facilities of £398.0m at 30 September 2022

(September 2021: £433.6m).

Based on these scenarios and the resources available to the Group, the Directors believe the Group has sufficient liquidity to manage through

a range of different cashflow scenarios for the next 18 months from the year end date. Accordingly, the Directors adopt the going concern

basis in preparing these Group Financial Statements.

Notes to the Group Financial Statements

year ended 30 September 2022

132 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

1. Group Statement of accounting policies continued

Significant accounting judgements and significant sources of estimation uncertainty

The preparation of the Group Financial Statements in accordance with IFRS requires management to make certain estimates, assumptions and

judgements that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Estimates

and underlying assumptions are reviewed on an ongoing basis. Changes in accounting estimates may be necessary if there are changes in the

circumstances on which the estimate was based or as a result of new information or more experience. Therefore, although these estimates

are based on management’s best estimate of the amount, event or actions, actual results ultimately may differ from those estimates. Such

changes are recognised in the year in which the estimate is revised. The Group has considered the impact of climate change on the financial

statements in the going concern assessments, impairment of non-financial assets and as part of the assumptions underpining the retirement

benefit obligations.

Significant accounting judgements

The following are the significant accounting judgements, apart from those involving estimations (which are dealt with separately below) that

are exercised in applying the Group accounting policies:

Going Concern

The Directors have a reasonable expectation that the Group has adequate resources to continue operating as a going concern for the foreseeable

future. This is based on cashflow projections and downside scenario modelling incorporating a recessionary environment in the UK which

includes customer spending constraints and inflation under recovery and potential supply side disruptions for the next 18 months from the

year end date, which is a significant judgement.

The details of the going concern scenarios, key assumptions and mitigating actions are outlined in the going concern statement on page 131.

Based on these scenarios and the resources available to the Group, the Directors believe the Group has sufficient liquidity to manage through

a range of different cashflow scenarios over the next 18 months from the 30 September 2022.

Accounting for exceptional items (Note 7)

The Group consider that items of income or expense which by virtue of their quantitative scale and/or qualitative nature should be disclosed

separately if the Group Financial Statements are to fairly present the financial position and financial performance of the Group. The Group

label these items collectively as ‘exceptional items’.

Determining which transactions are to be considered exceptional in nature is often a subjective matter. However, circumstances that the

Group believe would give rise to exceptional items for separate disclosure are outlined in the exceptional accounting policy on page 140.

All exceptional items are included on the appropriate income statement line item to which they relate. In addition, for clarity, separate

disclosure is made of all items in one column on the face of the Group Income Statement.

Taxation (Note 9)

Provisions for current and deferred taxes require judgement in areas where the treatment of certain items may be the subject of debate with tax

authorities. The Group provide for current and deferred taxes using the method that best predicts the resolution of the uncertainty. The Group

is required to consider the range of possible outcomes for a number of transactions and/or calculations across all the jurisdictions where the

Group is subject to income taxes and to provide for current and deferred taxes accordingly, applying either the ‘expected value method’ or the

‘most likely method’ for each uncertainty dependent on the method that we expect to better predict the resolution of the uncertainty in each

case. The Group consider this to be a judgemental area, due to the increasing complexity and a period of significant change in tax legislation

worldwide.

Recognition of deferred tax assets requires consideration of the value of those assets and the likelihood that those assets will be utilised in the

foreseeable future. The recognition relies on the availability of sound and relatively detailed forecast information regarding the future performance

of the business which has the legal right to utilise the deferred tax assets. The Group performed its assessment of the recovery of deferred tax

assets at 30 September 2022, taking into account the Group’s actual and historic performance, the impact of tax legislation enacted at the reporting

date and the detailed financial forecasts and budgets for the business covering the periods over which the assets are expected to be utilised.

Provisions (Note 23)

The recognition of provisions is a key judgement area in the preparation of the Group Financial Statements due to the uncertainty around the

timing or amount for which the provision will be settled. The Group recognises provisions for property dilapidation, remediation or closure

costs and other items such as restructuring or legal provisions. Provisions are recognised when the Group has a legal or constructive obligation

and judgement is required relating to the level of provision required at the reporting date to satisfy the obligation. These liabilities recognised

in the Group Financial Statements require judgement, as to the level of provision to be recognised, based on the information available to

management at the time of determination of the liability. Provisions are reassessed at each reporting date. The Group holds £9.9m of

provisions at 30 September 2022 (2021: £7.6m).

133Strategic Report | Directors’ Report | Financial Statements

Significant sources of estimation uncertainty

The Group’s significant estimates are those with a significant risk of resulting in a material adjustment to the carrying amounts of assets and

liabilities within the next financial year.

Impairment of goodwill (Note 12)

The Group has capitalised goodwill of £449.4m at 30 September 2022 (2021: £449.4m). Goodwill is required to be tested for impairment at

least annually or more frequently if changes in circumstances or the occurrence of events indicating potential impairment exist. As a result of

the UK external economic environment, the Group has identified the impairment of goodwill as a significant source of estimation uncertainty.

The Group uses the present value of future cash flows to determine the recoverable amount. In calculating the value in use, management

judgement and estimation is required in forecasting cash flows of Cash Generating Units (‘CGUs’), in determining terminal growth values and

in setting an appropriate discount rate. Sensitivities to changes in assumptions are detailed in Note 12.

Post-retirement benefits (Note 24)

The Group has identified post-retirement benefits as a significant source of estimation uncertainty in the preparation of the Group Financial

Statements. The estimation of, and accounting for, retirement benefit obligations involves assessments made in conjunction with independent

actuaries. These involve estimating the actuarial assumptions including mortality rates of members, increase in pension payments and inflation

linked increases to certain obligations and discount rates used in estimating the present value of the schemes assets and liabilities. In FY22,

there was a significant change in the Group’s retirement benefit obligations as a result of changes to the external economic environment.

Details of the financial position of the post-retirement benefit schemes and the sensitivity of assumptions are set out in Note 24.

New standards and interpretations

The following changes to IFRS became effective for the Group during the year but did not result in material changes to the Group’s

consolidated financial statements:

• Interest Rate Benchmark Reform – Phase 2 (amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IAS 16)

• Extension of the Temporary Exemption from Applying IFRS 9 (amendments to IFRS 4)

• COVID-19-Related Rent Concessions beyond 30 June 2021 (Amendment to IFRS 16)

New and amended standards and interpretations not yet mandatorily effective

The Group has not applied certain new standards, amendments and interpretations to existing standards which are not yet mandatorily effective:

• IFRS 17 Insurance Contracts

• Amendments to IAS 37 Onerous Contracts – Costs of fulfilling a contract

• Annual improvements to IFRS standards 2018 – 2020

• Amendments to IAS 16 Property, Plant and Equipment – Proceeds before intended use

• Amendments to IFRS 3 Reference to the Conceptual Framework

• Amendments to IAS 1 and IFRS Practice Statement 2 Disclosure of Accounting Policies

• Amendments to IAS 8 Definition of Accounting Estimate

• Amendments to IAS 1 Classification of liabilities as current or non-current*

• Amendments to IAS 12 Income Taxes – Deferred tax related to assets and liabilities arising from a single transaction*

• Initial application of IFRS 17 and IFRS 9 – Comparative information (amendments to IFRS 17)*

• Sale or contribution of assets between an investor and its associate or joint venture (amendments to IFRS 10 and IAS 28)*

• Amendments to IAS 1 Non current liabilities with covenants*

• Amendments to IFRS 16 Lease liability in sale and leaseback arrangement*

* The above standards/amendments have not yet been endorsed by the EU

The Company provides guarantees to subsidiaries in respect of bank borrowings which it accounts for as insurance contracts and therefore

further consideration is being provided to the potential impact of IFRS 17. The Group has reviewed the potential impact of other amendments

which are not expected to have a material impact on the Group when adopted.

Basis of consolidation

The Group Financial Statements comprise the Financial Statements of the parent undertaking and its subsidiary undertakings.

Subsidiaries

Subsidiary undertakings are included in the Group Financial Statements from the date on which control over the operating and financial

policies is obtained and cease to be consolidated from the date on which control is transferred out of the Group. The Group controls an

entity when it has power over the entity, or has the rights to, variable returns from its involvement with the entity and has the ability to affect

those returns through its power over the entity. The Group reassess whether or not it controls an investee if facts and circumstances indicate

that there are changes to one or more of the elements of control. All intra-Group transactions, balances and unrealised gains on transactions

between Group undertakings are eliminated on consolidation. Unrealised losses are also eliminated, except where they provide evidence

ofimpairment.

134 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

1. Group Statement of accounting policies continued

Revenue recognition

The Group’s revenue is primarily derived from the manufacture of convenience food products and all revenue relates to revenue from

contracts with customers. The Group’s customer contracts typically include one performance obligation, with revenue recognised when

the performance obligation is satisfied.

Revenue is measured based on the consideration specified in a contract with a customer and represents the fair value of the sale of goods

and rendering of services to external customers, net of value added tax and rebates in the ordinary course of the Group’s activities. Many of the

Group’s revenue contracts include an element of variable consideration, such as trade discounts, namely in the form of rebate arrangements

or other incentives to customers. The arrangements can take the form of volume and fixed rebates, marketing fund contributions, promotional

fund contributions or lump sum incentives. The Group recognises revenue net of such incentives in the period in which the arrangement

applies, only when it is highly probable a significant reversal in the cumulative amount of revenue will not occur. Volume based rebates are

calculated on the Group’s estimate of rebates expected to be paid to customers using the ‘most likely amount’ in line with IFRS 15 Revenue from

Contracts with Customers requirements, whereas fixed rebates are accounted for as a reduction in revenue over the life of the contract.

Revenue is recognised at a point in time, when control of the goods or services are transferred to the customer, which is deemed to be either

when the goods are dispatched or received by the customer, depending on individual contracts.

Supplier rebates

The Group enters into rebate arrangements with its suppliers, which are volume related. These supplier rebates received are recognised as a

deduction from cost of sales, based on the entitlement that has been earned up to the reporting date, for each relevant supplier arrangement.

Property, plant and equipment

Property, plant and equipment is shown at cost less depreciation and any impairments. The cost of property, plant and equipment comprises

its purchase price and any directly attributable costs.

Depreciation is provided so as to write off the cost less residual value of each item of property, plant and equipment during its expected useful

life using the straight-line method over the following periods:

Freehold and long leasehold buildings 25–50 years

Plant and machinery 3–25 years

Fixtures and fittings 3–25 years

Freehold land and capital work in progress is not depreciated

Useful lives and residual values are reassessed annually.

Subsequent costs incurred relating to specific assets are included in an asset’s carrying amount or recognised as a separate asset, as appropriate,

only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured

reliably. All other costs are charged to the profit or loss during the financial period in which they are incurred.

The carrying amounts of property, plant and equipment are reviewed for impairment when events or changes in circumstances indicate that

the carrying amounts may not be recoverable. When the carrying amount exceeds the estimated recoverable amount, the assets are written

down to their recoverable amount.

The recoverable amount of property, plant and equipment is the greater of fair value less costs of disposal and value in use. In assessing value

in use, estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments

of the time value of money and the risks specific to the asset. Impairment losses are recognised in profit or loss.

An assessment is made at each reporting date as to whether there is any indication that previously recognised impairment losses may no

longer exist or may have decreased. If such an indication exists, the recoverable amount is estimated. A previously recognised impairment loss

is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss

was recognised. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increased amount cannot

exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in

prior years. Such reversal is recognised in profit or loss. Following the recognition or reversal of an impairment loss, the depreciation charge

applicable to the asset is adjusted prospectively in order to systematically allocate the revised carrying amount, net of any residual value, over

the remaining useful life.

Gains or losses on the disposal of property, plant and equipment represent the difference between the net proceeds and the carrying value at

the date of sale.

Leases

The Group leases various properties, motor vehicles and equipment. Rental contracts are typically made for fixed periods but may have

extension options. Lease terms are negotiated on an individual basis and contain a wide range of different terms and conditions.

135Strategic Report | Directors’ Report | Financial Statements

At inception of a contract, the Group assesses whether a contract is, or contains, a lease. A right-of-use asset and lease liability are recognised

at commencement for contracts containing a lease, with the exception of leases with a term of 12 months or less or leases where the

underlying asset is of low value. For those leases, the Group recognises the lease payments as an operating expense on a straight line basis

over the term of the lease unless another more systematic basis is more representative of the time pattern in which the economic benefits

from the leased assets are consumed by the Group.

The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted by

using the interest rate implicit in the lease or if this rate cannot be readily determined, the incremental borrowing rate. Lease payments include

fixed payments, payments for an optional renewal period and termination option payments. The lease term is the non-cancellable period for

which the Group have the right to use an underlying asset, together with (i) periods covered by an option to extend the lease if the Group is

reasonably certain to exercise that option; and (ii) periods covered by an option to terminate the lease if the Group is reasonably certain not

to exercise that option. The Group has applied judgement to determine the lease term for lease contracts that include renewal options and

break clauses.

Following initial recognition, the lease liability is measured at amortised cost using the effective interest method. It is remeasured when there

is a change in future minimum lease payments or when the Group changes its assessment of whether it is reasonably certain to exercise an

option within a contract.

The right-of-use asset is initially measured at cost, which comprises the initial amount of the lease liability adjusted for any lease payments

made at or before the commencement date, plus any initial direct costs incurred and an estimate of costs to dismantle and remove the asset

less any lease incentives received. After lease commencement, the Group measures right-of-use assets using a cost model, reflecting cost less

accumulated depreciation and impairment. The right-of-use asset is depreciated using the straight-line method from the commencement

date to the earlier of the end of the useful life of the right-of-use asset or the end of lease term.

The Group remeasures the lease liability (and makes a corresponding adjustment to the related right-of-use asset) whenever:

• The lease term has changed or there is a significant event or change in circumstances resulting in a change in the assessment of exercise

of a purchase option, in which case the lease liability is remeasured by discounting the revised lease payments using a revised discount rate;

• The lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed residual value, in

which cases the lease liability is remeasured by discounting the revised lease payments using an unchanged discount rate unless the lease

payments change is due to a change in a floating interest rate, in which case a revised discount rate is used; or

• A lease contract is modified and the lease modification is not accounted for as a separate lease, in which case the lease liability is

remeasured based on the lease term of the modified lease by discounting the revised lease payments using a revised discount rate at the

effective date of the modification.

Goodwill

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree,

and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the

identifiable assets acquired and the liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets

acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree

and the fair value of the acquirer’s previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as a

bargain purchase gain.

Following initial recognition, goodwill is measured at cost less any accumulated impairment losses. On acquisition, goodwill is allocated to

CGUs expected to benefit from the combination’s synergies. Goodwill is tested annually for impairment or more frequently if events or

changes in circumstances indicate that the carrying value may be impaired. Any impairment is recognised immediately in profit or loss.

Acquisition related intangibles

An intangible asset, which is an identifiable non-monetary asset without physical substance, is capitalised separately from goodwill as part of

a business combination to the extent that it is probable that the expected future economic benefits attributable to the asset will accrue to the

Group and that its fair value can be measured reliably. The asset is deemed to be identifiable when it is separable (i.e. capable of being divided

from the entity and sold, transferred, licensed, rented or exchanged, either individually or together with a related contract, asset or liability) or

when it arises from contractual or other legal rights, regardless of whether those rights are transferable or separable from the Group or from

other rights and obligations.

Subsequent to initial recognition, the acquisition related intangible assets acquired as part of a business combination, are carried at cost less

any accumulated amortisation and any accumulated impairment losses. The carrying amounts of intangible assets with finite lives are

reviewed for indicators of impairment at each reporting date and are subject to impairment testing when events or changes in circumstances

indicate that the carrying values may not be recoverable. Any impairment charge is taken to profit or loss.

The amortisation of intangible assets is calculated to write off the carrying amount of intangible assets with finite lives over their useful lives

on a straight-line basis on the assumption of zero residual value. Customer related intangible assets are amortised over periods ranging from

one to seven years.

136 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

1. Group Statement of accounting policies continued

Acquisition related intangibles (continued)

The useful life used to amortise intangible assets relates to the future performance of the assets acquired and management’s estimate of the

period over which economic benefit will be derived from the asset. The remaining useful life of intangible assets with finite lives are reviewed

at the end of each reporting period and revised where appropriate to reflect the period over which the Group will receive the economic

benefit from use.

Computer software

Costs incurred on the acquisition of computer software and software licences are capitalised. Other costs directly associated with developing

and upgrading computer software programs are capitalised once the recognition criteria set out in IAS 38 Intangible Assets are met. There is a

full assessment carried out to ensure the computer software does not qualify as software as a service and should be expensed to the profit or

loss in the year.

Following initial recognition, computer software is carried at cost less accumulated amortisation and any accumulated impairment losses.

Amortisation is charged to profit or loss during its expected useful life using the straight-line method over the following periods:

Computer software 3–7 years

The carrying amount of computer software assets are reviewed for indicators of impairment at each reporting date and are subject to

impairment testing when events or changes in circumstances indicate the carrying value may not be recoverable.

Investment property

Investment property is shown at cost less depreciation and any impairment. The cost of investment property comprises its purchase price and

any costs directly attributable to bringing it into working condition for its intended use. Investment property is depreciated so as to write off

the cost, less residual value, on a straight-line basis over the expected life of each property. Freehold buildings held as investment property are

depreciated over their expected useful life, normally assumed to be 40-50 years. Freehold land is not depreciated.

An impairment to investment property is recognised when the carrying value of the asset exceeds the recoverable value. The recoverable value is

determined as the higher of the fair value less costs of disposal and the assets value in use. Fair value is determined by external property valuers.

Rental income arising on investment property is accounted for as an operating lease in line with the requirements of IFRS 16 Leases and is

recognised within other operating income.

In relation to the recognition of income on the disposal of property, income is recognised when there is an unconditional exchange of contracts,

or when all necessary terms and conditions have been fulfilled.

Inventories

Inventories are valued at the lower of cost and net realisable value. Cost is calculated based on first-in, first-out or weighted average as

appropriate. Cost includes raw materials, direct labour expenses and related production and other overheads net of supplier rebates.

Net realisable value is the estimated selling price, in the ordinary course of business, less all costs necessary to make the sale.

Provisions

Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an

outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the

amount of the obligation.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the

class of obligation as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same

class of obligation may be small.

Where the Group expects some or all of a provision to be reimbursed, the reimbursement is recognised as a separate asset, but only when the

reimbursement is virtually certain. The expense relating to any provision is recognised in the Group Income Statement net of any reimbursement.

A contingent liability is disclosed where the existence of an obligation will only be confirmed by future events, or where the amount of the

obligation cannot be measured with reasonable reliability. Contingent assets are not recognised but are disclosed where an inflow of

economic benefits is probable.

137Strategic Report | Directors’ Report | Financial Statements

Finance income and finance costs

Finance income comprises interest income on funds invested and the unwind of discount on assets. Interest income is recognised in profit or

loss as it accrues, using the effective interest method.

Finance costs comprises interest expense on borrowings, negative interest, if any, on bank deposits, unwind of discount on liabilities, interest

on lease obligations, interest on the net defined benefit pension scheme liabilities, changes in fair value of hedging instruments and other

derivatives that are recognised in profit or loss. All borrowing costs are recognised in profit or loss using the effective interest method.

Financial instruments

On initial recognition, a financial asset is classified as measured at amortised cost, or fair value through other comprehensive income (‘FVOCI’)

or fair value through profit or loss (‘FVPL’). The classification is based on the business model for managing the financial asset and the contractual

terms of the cashflows. Reclassification of financial assets is required only when the business model for managing those assets changes.

Financial assets are derecognised when the Group’s contractual rights to the cashflows from the financial assets expire, are extinguished or

are transferred to a third party.

Financial liabilities are classified as measured at amortised cost or FVPL. Financial Liabilities are derecognised when the Group’s obligations

specified in the contracts expire, are discharged or cancelled. When an existing financial liability is replaced by another from the same lender

on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as

a derecognition of the original liability, the recognition of a new liability which has the result that the difference in the respective carrying

amounts is recognised, together with any resulting costs.

Cash and cash equivalents and bank overdrafts

Cash and cash equivalents are initially recognised at fair value and subsequently carried at amortised cost. Cash and cash equivalents include

cash in hand, deposits held on call with banks and other short term highly liquid investments that are readily convertible to known amounts

of cash. These are subject to insignificant risk of changes in value and have an original maturity of three months or less.

The Group operates a cash pooling facility which allows subsidiaries of the Group to drawdown on cash from the pool, where the Group has

sufficient cash balances. The cash pooling arrangement operated by the Group includes a legal right of offset however does not meet the

requirements for offsetting in accordance with IAS 32 Financial Instruments: Presentation and as such bank overdrafts are presented separately

to cash on the Group Statement of Financial Position.

Trade and other receivables

Trade and other receivables are initially recognised at transaction price and subsequently carried at amortised cost, net of allowance for

expected credit loss.

The Group applies the simplified approach to providing for expected credit losses (‘ECL’) required by IFRS 9 Financial Instruments, which requires

expected lifetime losses to be recognised from initial recognition of the trade receivables. The Group uses an allowance matrix to measure

the ECL of trade receivables based on its expected loss rates. Expected loss rates are based on historical payment profiles of sales and the

corresponding historical credit loss experience. The historical loss rates are adjusted to reflect current and forward economic factors if there

is evidence to suggest these factors will affect the ability of the customer to settle receivables. The Group has determined the ECL default rate

using market default risk probabilities with regard to its key customers. Balances are written off when the probability of recovery is assessed

as being remote.

Trade receivables are derecognised when the Group no longer controls the contractual rights that to the receivables. This is normally the case

when the asset is sold or the rights to receive cash flows from the asset have expired, and the Group has not retained substantially all the credit

risks and control of the receivable has transferred.

Trade and other payables

Trade and other payables are initially recorded at fair value and subsequently at amortised cost.

Borrowings

All loans and borrowings are initially recognised at fair value less any directly attributable transaction costs. After initial recognition, loans and

borrowings are subsequently measured at amortised cost using the effective interest method.

Borrowings are derecognised when the Group’s obligations specified in the contracts expire, are discharged or cancelled.

When the Group modifies the terms of its debt facilities, it determines if the modification is a substantial or non-substantial modification.

A substantial change is attributable to a change in contractual cashflows of more than 10%, resulting in a derecognition of the existing facilities

and recognition of a new facility. A non-substantial modification to facilities results in the recognition of a modification gain or loss in the

income statement. A modification gain or loss is determined by recalculating the gross carrying value of the borrowings by discounting the

new contractual cash flows using the original effective interest rate. The transaction cost associated with modifying the terms of the

borrowings are spread forward by the adjusted effective interest rate. Borrowings are classified as current liabilities unless the Group has an

unconditional right to defer settlement of the liability for at least 12 months after the reporting date. Accrued interest is recorded in accruals

within current liabilities.

138 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

1. Group Statement of accounting policies continued

Financial instruments continued

Derivative financial instruments

The activities of the Group expose it to the financial risks of changes in foreign exchange rates and interest rates. The Group uses derivative

financial instruments, such as forward foreign exchange contracts, cross-currency swaps and interest rate swap agreements, to hedge

these exposures.

Derivative financial instruments are initially recognised at fair value on the date a derivative contract is entered into and are subsequently

remeasured at fair value.

Derivatives are carried as assets when the fair value is positive and as liabilities when the fair value is negative. Derivative instruments which are

held for trading and are not designated as effective hedging instruments are classified as a current asset or liability (as appropriate) regardless

of maturity if the Group expects that they may be settled within 12 months of the reporting date. All other derivative instruments that are not

designated as effective hedging instruments are classified by reference to their maturity date. The full fair value of a hedging derivative is

classified as a non-current asset or liability if the remaining maturity of the hedged item is more than 12 months and as a current asset or

liability if the maturity of the hedged item is less than 12 months.

The fair value of derivative instruments is determined by using valuation techniques. The Group uses its judgement to select the most

appropriate valuation methods and makes assumptions that are mainly based on observable market conditions existing at the reporting date.

For those derivatives designated as hedges and for which hedge accounting is sought, the hedging relationship is documented at its inception.

This documentation identifies the hedging instrument, the hedged item or transaction, the nature of the risk being hedged and how hedge

effectiveness will be measured throughout its duration. Such hedges are expected at inception to be highly effective in offsetting changes in

fair values or cash flows of hedged items.

For the purposes of hedge accounting, derivatives are classified as:

• Fair value hedges, when hedging the exposure of changes in the fair value of a recognised asset or liability; or

• Cash flow hedges, when hedging the exposure to variability in cash flows that are either attributable to a particular risk associated with

a recognised asset or liability, or a highly probable forecast transaction; or

• Net investment hedges, when hedging the exposure to foreign currency differences between the functional currency of a foreign

operation and the functional currency of the parent.

Any gains or losses arising from changes in the fair value of all other derivatives which are classified as held for trading are taken to the income

statement and charged to finance income or expense. These may arise from derivatives for which hedge accounting is not applied because

they are not designated as hedging instruments. The Group does not use derivatives for trading or speculative purposes.

The hedges that the Group has in place are cash flow hedges and the treatment is set out below:

Cash flow hedge

Where a derivative financial instrument is designated as a hedge of the variability in cash flows of a recognised asset or liability, or a highly

probable forecast transaction, the effective part of any gain or loss on the derivative financial instrument is recognised within equity in the

hedging reserve, with the ineffective portion being reported in the income statement as finance income or finance costs. When a highly

probable forecast transaction results in the recognition of a non-financial asset or liability, the cumulative gain or loss is removed from the

hedging reserve in equity and included in the initial measurement of the non-financial asset or liability. Otherwise, the associated gains and

losses that had previously been recognised within equity in the hedging reserve are transferred to the income statement as the cash flows of

the hedged item impact profit or loss.

Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, exercised or no longer qualifies for hedge

accounting. At that point in time, any cumulative gain or loss on the hedging instrument recognised within equity in the hedging reserve is

kept in the hedging reserve until the forecast transaction occurs. If a hedged transaction is no longer anticipated to occur, the net cumulative

gain or loss recognised within equity in the hedging reserve is transferred immediately to the income statement as finance costs.

Taxation

The charge/credit for the year comprises current and deferred tax. Tax is recognised in profit or loss except to the extent that it relates to items

recognised in the Group Statement of Comprehensive Income or directly in equity, in which case the tax is also recognised in the Group

Statement of Comprehensive Income or directly in equity, respectively.

Current tax payable represents the expected tax payable on the taxable income for the year, using tax rates and tax laws enacted or

substantively enacted at the reporting date, along with any adjustment to tax payable in respect of previous years.

139Strategic Report | Directors’ Report | Financial Statements

The Group provides in full for deferred tax assets and liabilities (using the liability method), arising from temporary differences between the tax

base of assets and liabilities and their carrying amounts in the Group Financial Statements except where they arise from the initial recognition

of goodwill or from the initial recognition of an asset or liability that at the date of initial recognition does not affect accounting or taxable

profit or loss on a transaction that is not a business combination. Such differences result in an obligation to pay more tax or a right to pay less

tax in future periods. A deferred tax asset is only recognised where it is probable that future taxable profits will be available against which the

temporary differences giving rise to the asset can be utilised.

Deferred tax assets and liabilities are not subject to discounting and are measured at the tax rates that are enacted or substantively enacted at

the reporting date.

Deferred tax is provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal

of the temporary difference can be controlled and it is probable that the temporary difference will not reverse in the foreseeable future.

The Group is subject to income taxes in a number of jurisdictions. Judgement is required in determining the Group’s provision for income taxes.

There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business.

The Group recognises liabilities for tax uncertainties based on estimates of whether additional taxes will be due. Where the final tax outcome

of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax

provisions in the period in which such determination is made. Once it has been concluded that a liability needs to be recognised, the liability is

measured based on either (i) the most likely amount or (ii) the expected value depending on which method the Group expects to better predict

the resolution of the uncertainty. The assessment is based on the judgement of tax professionals within the Group supported by previous

experience in respect of such activities and in certain cases based on specialist independent advice.

Employee benefits

Defined contribution pension plans

A defined contribution pension plan is a plan under which the Group pays fixed contributions into a separate defined contribution scheme.

Obligations for contributions to defined contribution pension plans are recognised as an expense within profit or loss as employee service

is received.

Defined benefit pension plans

All of the legacy defined benefit pension schemes have been closed to future accrual since 31 December 2009. The cost of providing

benefits under the Group’s defined benefit pension plans is determined separately for each plan, using the projected unit credit method,

by professionally qualified actuaries and arrived at using actuarial assumptions based on market expectations at the reporting date. These

valuations attribute entitlement benefits to the current and prior periods to determine current service costs and the present value of defined

benefit pension obligations.

Re-measurements, comprising of actuarial gains and losses and the return on plan assets (excluding net interest), are recognised immediately

in the Group Statement of Financial Position with a corresponding debit or credit to retained earnings through the Group Statement of

Comprehensive Income in the period in which they occur. Re-measurements are not reclassified to profit or loss in subsequent periods.

Past service costs are recognised in profit or loss on the earlier of:

• The date of the plan amendment or curtailment; and

• The date that the Group recognises restructuring-related costs.

Net interest is calculated by applying the discount rate to the net defined benefit pension liability or asset.

When a settlement (eliminating all obligations for defined benefits already accrued) or a curtailment (reducing future obligations as a result

of a material reduction in the scheme membership or a reduction in future entitlement) occurs, the obligation and related plan assets are

remeasured using current actuarial assumptions and the resultant gain or loss is recognised in profit or loss during the period in which the

settlement or curtailment occurs.

The Group seeks ways to reduce its liabilities through various restructuring activities. When a qualifying insurance policy is purchased for

the scheme liabilities, this is treated as a plan asset and the fair value of the insurance policy is deemed to be the present value of the related

obligations. A settlement will only arise in winding up a scheme, when the Group enters into a transaction that eliminates all further legal or

constructive obligations for part or all the benefits provided under a defined benefit plan.

The defined benefit pension asset or liability in the Group Statement of Financial Position comprises the total, for each plan, of the present

value of the defined benefit pension obligation (using a discount rate based on high quality corporate bonds) less the fair value of plan assets

out of which the obligations are to be settled directly. Fair value is based on market price information, and in the case of quoted securities is

the published bid price. For unquoted securities, the most recent publicly available information is used to calculate the fair value, which may

differ from the year end date. The value of a net pension benefit asset is the present value of any economic benefit the Group reasonably

expects to recover by way of refund of surplus from the plan at the end of the plan’s life or reduction in future contributions to the plan.

140 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

1. Group Statement of accounting policies continued

Employee share-based payments

The Group grants equity settled share-based payments to employees (through the Performance Share Plan, the Annual Bonus Plan, Employee

Sharesave Scheme and Employee Share Incentive Plan). The fair value of these is determined at the date of grant and is expensed to profit or

loss with a corresponding increase in equity on a straight-line basis over the vesting period. The fair value is determined using an appropriate

valuation model, as measured at the date of grant, excluding the impact of any non-market conditions. Non-market vesting conditions are

included in assumptions about the number of options that are expected to vest. At each reporting date, the Group revises its estimates of the

number of options or awards that are expected to vest, recognising any adjustment in profit or loss, with a corresponding adjustment to equity.

To the extent that the Group receives a tax deduction relating to services paid for by means of share awards or options, deferred tax is provided

on the basis of the difference between the market price of the underlying equity as at the date of grant and the exercise price of the option.

As a result, the deferred tax impact of share options will not directly correlate with the expense reported in profit or loss.

To the extent that the deductible difference exceeds the cumulative charge to the Group Income Statement, it is recorded in equity. When the

exercise of share options results in the issuance of shares, the proceeds received are credited to the share capital and share premium accounts.

Foreign currency

Functional and presentational currency

The individual financial statements of each Group entity are measured in the currency of the primary economic environment in which the

entity operates (the functional currency). The Group Financial Statements are presented in sterling, which is also the Company’s functional

and presentation currency.

Transactions and balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the date of the transactions.

Foreign exchange gains and losses resulting from the settlement of such transactions, and from the translation at year-end exchange rates of

monetary assets and liabilities denominated in foreign currencies, are recognised in the Group Income Statement, except when deferred in

equity as qualifying cash flow hedges.

Foreign operations

The income statement and statement of financial position of Group entities that have a functional currency different from the presentation

currency of the Company are translated into the presentation currency as follows:

• Assets and liabilities are translated at the closing rate at the reporting date;

• Income and expense items are translated at the average exchange rates for the year, unless exchange rates fluctuate significantly during

that period, in which case the exchange rates at the date of transactions are used; and

• All resulting exchange differences are recognised as a separate component of equity.

On consolidation, exchange differences arising from the translation of the net investment in foreign operations and on long term borrowings

and other currency instruments designated as hedges of such investments, are taken to equity. When a foreign operation is sold, exchange

differences that were recorded in equity are recognised in the Group Income Statement as part of the gain or loss on sale.

Research and development

Expenditure on research and development is recognised as an expense in the period in which it is incurred. An asset is recognised only when

all the conditions set out in IAS 38 Intangible Assets are met.

Segmental reporting

The operating segment, Convenience Foods UK and Ireland, is reported in a manner consistent with the internal management structure of the

Group and the internal financial information provided to the Group’s Chief Operating Decision Maker who is responsible for making strategic

decisions, allocating resources, monitoring and assessing the performance of the segment. The Group reports segmental information by

product category and geographical area. Note 2 sets out the operating and reportable segment of the Group.

Exceptional items

The Group has adopted an income statement format that seeks to highlight exceptional items within the Group’s results for the year.

Judgement is used by the Group in assessing the particular items which by virtue of their quantitative scale and/or qualitative nature should

be disclosed as exceptional items. Such items may include, but are not limited to, significant reorganisation programmes, profits or losses

on termination of operations, significant impairments of assets, transaction and integration costs related to acquisition activity, transaction

costs related to disposal activity and litigation costs and settlement. Exceptional items are included in a separate column within the income

statement caption to which they relate and are separately disclosed in the notes to the Group Financial Statements. Where an item that has

been classified as exceptional spans more than one reporting period such as a multi-year restructuring programme, it will also be presented

as exceptional in the following period for consistency of presentation. The Group separately presents the cash paid for exceptional items

in the Group Statement of Cash Flows and the tax impact in the exceptional note disclosure.

141Strategic Report | Directors’ Report | Financial Statements

Share capital

Ordinary Shares

Ordinary Shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are taken as a deduction

from equity, net of tax, from the proceeds.

Own Share Reserve

The Own Share Reserve relates to Ordinary Shares in the Company, which are held in trust. The shares held in trust are granted

to the beneficiaries of the Group’s employee share award scheme when the relevant conditions of the scheme are satisfied, with a transfer

between the own share reserve and retained earnings when the transfer occurs.

2. Segment information

Convenience Foods UK and Ireland is the Group’s operating segment, which represents its reporting segment. This reflects the Group’s

organisational structure and the nature of the financial information reported to and assessed by the Chief Operating Decision Maker (‘CODM’)

as defined by IFRS 8 Operating Segments. In November 2021, the Group’s then Chief Executive Officer (‘CEO’) informed the Board of Directors

he was stepping down from his position as Executive Director and CEO with effect from 30 March 2022. From the date of his departure, the

CODM moved to being the Board of Directors and continues to be the Board of Directors.

This segment incorporates UK convenience food categories including sandwiches, salads, sushi, chilled snacking, chilled ready meals, chilled

soups and sauces, chilled quiche, ambient sauces and pickles and frozen Yorkshire Puddings as well as the Irish ingredients trading business.

Convenience Foods

UK & Ireland

2022

£m

2021

£m

Revenue 1,739.6 1,324.8

Group operating profit before exceptional items and amortisation of acquisition related intangible assets 72.2 39.0

Amortisation of acquisition related intangible assets (3.6) (3.9)

Group operating profit before exceptional items 68.6 35.1

Finance income 0.2 0.1

Finance costs (12.5) (19.1)

Exceptional items (16.5) 11.7

Taxation (7.5) (2.1)

Profit for the year 32.3 25.7

The following table disaggregates revenue by product categories in the Convenience Foods UK and Ireland reporting segment. The Group’s

revenue by geography is included on page 142.

2022

£m

2021

£m

Revenue

Food to go categories 1,161.3 842.1

Other convenience categories 578.3 482.7

Total revenue for Convenience Foods UK and Ireland 1,739.6 1,324.8

Food to go categories include sandwiches, salads, sushi and chilled snacking while the other convenience categories include chilled ready

meals, chilled soups and sauces, chilled quiche, ambient sauces and pickles, and frozen Yorkshire Puddings as well as an Irish ingredients

trading business.

Revenue earned individually from three customers in Convenience Foods UK and Ireland of £316.0m, £261.0m and £196.3m each respectively

represents more than 10% of the Group’s revenue (2021: Revenue earned individually from four customers in Convenience Foods UK and

Ireland of £278.1m, £168.1m, £145.0m and £133.9m each respectively represents more than 10% of the Group’s revenue).

Segment assets and liabilities

All assets and liabilities are allocated to the Convenience Foods UK and Ireland segment. As such, an analysis of assets and liabilities has not

been included in this disclosure.

142 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

2. Segment information continued

Other segment information

Convenience Foods

UK & Ireland

2022

£m

2021

£m

Capital additions* 50.4 35.9

Depreciation 51.6 50.2

Amortisation of computer software and other intangibles 3.1 3.1

Amortisation of acquisition related intangible assets – Customer related 3.6 3.9

Non-current assets (excluding derivative financial instruments, retirement benefit assets and deferred tax assets) 835.3 838.2

Geographic analysis

Ireland UK

Convenience Foods

UK & Ireland

2022

£m

2021

£m

2022

£m

2021

£m

2022

£m

2021

£m

Revenue 92.0 58.8 1,647.6 1,266.0 1,739.6 1,324.8

Capital additions* – – 50.4 35.9 50.4 35.9

Non-current assets (excluding derivative

financial instruments, retirement benefit

assets and deferred tax assets) 6.6 7.3 828.7 830.9 835.3 838.2

* This denotes capital additions for property, plant and equipment and software and other intangibles

3. Operating costs before acquisition related amortisation

2022

£m

2021

£m

Administrative expenses 367.5 321.6

Distribution costs 70.9 53.8

Research and development 8.9 7. 2

Other operating costs 4.1 6.5

Other operating income (1.8) (5.8)

Total operating costs before acquisition related amortisation 449.6 383.3

Exceptional items (Note 7) 16.5 (7.7)

Total operating costs before acquisition related amortisation 466.1 375.6

Additional analysis of the key costs for administrative expenses have been included below:

2022

£m

2021

£m

Employee related costs 209.4 185.6

Depreciation/Amortisation 54.7 53.3

Factory utility and overhead costs 63.2 45.8

Professional fees and other administrative costs 40.2 36.9

Total administrative expenses 367.5 321.6

IT security incident

In December 2021, the Group experienced an IT security incident that resulted in temporary unauthorised access to part of the Group’s IT

systems. The Group recognised gross costs of £10.5m relating to the disruption to operations and professional fees incurred and £8.6m of

insurance income as a result of insurance claims arising from the IT security incident resulting in a net expense recognised in profit or loss

of£1.9m.

143Strategic Report | Directors’ Report | Financial Statements

4. Result for the financial year

The result for the Group for the financial year has been arrived at after charging/(crediting) the following amounts:

2022

£m

2021

£m

Depreciation:

Property, plant and equipment 36.0 35.3

Right-of-use assets 15.6 14.9

51.6 50.2

Amortisation of intangible assets 6.7 7.0

Lease rentals charge for low value and short term leases 5.6 1.0

Rental income from investment properties (0.1) (0.1)

2022

£m

2021

£m

Directors’ remuneration

Emoluments and fees 1.9 2.1

Pension costs – defined contribution plans 0.1 0.2

Gain on exercise of share-based payment options 0.1 0.1

Total 2.1 2.4

During the current financial year, there were amounts accruing for four of the Directors under pension schemes (2021: two).

2022

£000

2021

£000

Auditor’s remuneration

Fees charged by the statutory audit firm:

Audit of the Group and subsidiaries financial statements* 797 605

Audit of the Company financial statements 42 –

Audit related assurance services – –

Other assurance services 25 25

Total 864 630

* Included within the £605k shown in the prior year is £35k relating to the audit of the Company financial statements. In the current year, the amount for the audit of the

Company financial statements has been presented separately.

5. Employment

The average monthly number of persons (including Executive Directors) employed by the Group during the year was:

2022

Number

2021

Number

Production 9,615 8,614

Distribution 1,544 1,341

Administration 2,732 2,525

13,891 12,480

The staff costs for the year for the above employees were:

2022

£m

2021

£m

Wages and salaries 380.9 306.4

Social insurance costs 35.9 28.2

Employee share-based payment expense (Note 6) 3.0 2.1

Termination costs 4.8 –

Pension costs – defined contribution plans (Note 24) 14.1 12.8

438.7 349.5

Legacy defined benefit interest cost (Note 24) 1.1 1.7

439.8 351.2

144 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

5. Employment continued

During the prior year, the Group furloughed a number of employees across its sites for varying periods of time, availing of the Coronavirus

Job Retention Scheme. All conditions had been met under the terms of the grant and the Group recognised income amounts of £8.7m with

respect to the scheme. The grant was netted against the associated employee related costs. There were no claims made under the scheme in

the current year.

Total staff costs recognised in the Group profit or loss were £437.5m (2021: £348.8m) while £2.3m of staff costs were capitalised during the

year (2021: £2.4m).

Actuarial gain on Group legacy defined benefit schemes recognised in the Group Statement of Other Comprehensive Income:

2022

£m

2021

£m

Return on plan assets (Note 24) (141.9) 31.1

Actuarial gain arising on scheme liabilities (Note 24) 156.3 5.2

Total gain taken directly to equity 14.4 36.3

6. Share-based payments

The Group operates a number of employee share award schemes which are equity settled share-based payments as defined in IFRS 2

Share-based payments. A recognised valuation methodology is employed to determine the fair value of awards granted as set out in the

standard. The charge incurred relating to these awards is recognised within operating costs. Detail of each of the employee share schemes

operated by the Group are set out below.

Annual Bonus Plan

Senior Executives participate in the Annual Bonus Plan as outlined in the Report on Directors’ Remuneration. In accordance with this plan,

a deferred share award equal to a proportion of the cash bonus is awarded to the participating executives. The number of shares is calculated

at market value on the date of allocation, to be held by a trustee for the benefit of individual participants without any additional performance

conditions other than three years of service. The shares vest after three years but are forfeit should an executive voluntarily leave the Group

within the three year time period, subject to normal ‘good leaver’ provisions. The charge recognised in the Group Income Statement was

£0.5m (2021: £0.9m) with £0.2m (2021: £0.9m) being recognised within operating costs and £0.3m (2021: £Nil) being recognised within

exceptional items.

The share price on the grant date, for awards granted in December 2021 was £1.29 (December 2020: £1.18).

On 1 December 2021 and 1 December 2020, 862,426 and 563,239 respectively, awards were granted to Senior Executives of the Group under

the Annual Bonus Plan.

The following table illustrates the number of, and movements in, share awards during the year under the plan:

2022

Number

outstanding

2021

Number

outstanding

At beginning of year 942,200 801,226

Granted 862,426 563,239

Vested (264,968) (378,078)

Forfeit (220,568) (44,187)

At end of year 1,319,090 942,200

Exercisable at end of year 426,857 –

Awards will be granted to Senior Executives of the Group under the Annual Bonus Plan in respect of the year ended 30 September 2022.

A charge amounting to £0.05m (2021: £0.2m) relating to awards to Executive Directors and £0.1m (2021: £0.2m) relating to awards to other

senior executives has been included in the Group Income Statement in respect of the estimated 2022 charge. The total fair value of the

awards will be taken as a charge to the Group Income Statement over the vesting period of the awards.

Performance Share Plan

Certain employees participate in a long term incentive scheme, the Performance Share Plan. In accordance with the scheme rules,

participants are awarded an allotment of shares which will vest over three years subject to vesting conditions based on growth in Adjusted

Earnings per Share, Return on Invested Capital and relative Total Shareholder Return (TSR). An additional two year future service period will

apply to Executive Directors’ vested shares before they are released.

In January 2021, the Group introduced different vesting conditions for awards granted which included an absolute TSR and a relative TSR

component. In addition, the awards granted have graded vesting periods of one, two and three years with a two year and one year holding

period for awards vesting within three years.

145Strategic Report | Directors’ Report | Financial Statements

The number of shares granted is calculated based on the market value on the date of allocation. Share awards are forfeit should an executive

voluntarily leave the Group prior to the vesting date, subject to normal ‘good leaver’ provisions. The fair value of the award has attributed

a value to each vesting condition. The relative TSR is fair valued using a Monte Carlo simulation as described further in this note.

A charge amounting to £0.9m (2021: £0.3m) was included in the Group Income Statement in the year ended 30 September 2022 relating

to these awards for all Performance Share Plan awards granted from December 2018 onwards.

The following table illustrates the number of, and movements in, share awards during the year under the plan:

2022

Number

outstanding

2021

Number

outstanding

At beginning of year 7,707,473 5,580,887

Granted 3,048,764 4,110,686

Vested – (286,887)

Expired (2,575,145) (1,250,252)

Forfeit (2,091,998) (446,961)

At end of year 6,089,094 7,707,473

Exercisable at end of year – –

Sharesave Schemes

The Group operates savings-related share option schemes in both the UK and Ireland. Options are granted at a discount of between 20% and

25% of the market price at the date of invitation over three year savings contracts and options are exercisable during the six month period

following completion of the savings contract. The charge recognised in the Group Income Statement in respect of these options was £1.2m

(2021: £0.9m). Grant date fair value was arrived at by applying a trinomial model, which is a lattice option-pricing model.

During the year ended 30 September 2022, 6,231,802 Sharesave Scheme options were granted in the UK only, which will ordinarily be

exercisable at an exercise price of £0.91 per share, during the period 1 September 2025 to 28 February 2026. The weighted average fair value

of share options granted during the year ended 30 September 2022 was £0.11.

During the prior year ended 24 September 2021, 5,860,829 Sharesave Scheme options were granted in the UK only, which will ordinarily be

exercisable at an exercise price of £1.06 per share, during the period 1 September 2024 to 28 February 2025. The weighted average fair value

of share options granted during the year ended 24 September 2021 was £0.46.

Number and weighted average exercise price for the UK Sharesave Scheme (expressed in sterling)

The following table sets out the number and weighted average exercise prices (expressed in sterling) of, and movements in, share options

during the year under the UK ShareSave Scheme:

2022 2021

Number

outstanding

Weighted

average

exercise price

Number

outstanding

Weighted

average

exercise price

At beginning of year 14,253,181 1.16 11,932,460 1.28

Granted 6,231,802 0.91 5,860,829 1.06

Exercised (11,853) 1.14 (32,264) 1.52

Expired (1,261,628) 1.42 (743,643) 1.83

Forfeit (5,705,343) 1.12 (2,764,201) 1.26

At end of year 13,506,159 1.04 14,253,181 1.16

Exercisable at end of year 542,545 1.66 1,011,353 1.48

Range of exercise prices for the UK Sharesave scheme (expressed in sterling)

At end of year Exercisable at end of year

Number

outstanding

Weighted

average

contract life

years

Weighted

average

exercise price

Number

exercisable

Weighted

average

exercise price

At 30 September 2022

£0.01-£1.00 5,926,561 3.27 0.91 – –

£1.01-£2.00 7,579,598 1.63 1.14 542,545 1.66

13,506,159 3.25 1.04 542,545 1.66

At 24 September 2021

£1.01-£2.00 14,253,181 2.48 1.16 1,011,353 1.48

14,253,181 2.48 1.16 1,011,353 1.48

146 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

6. Share-based payments continued

Sharesave Schemes continued

Number and weighted average exercise prices for the Irish Sharesave Scheme (expressed in euro)

The following table sets out the number and weighted average exercise prices (expressed in euro) of, and movements in, share options during

the year under the Irish ShareSave Scheme:

2022 2021

Number

outstanding

Weighted

average

exercise price

€

Number

outstanding

Weighted

average

exercise price

€

At beginning of year 147,996 1.30 168,575 1.31

Exercised (6,722) 1.19 – –

Expired (28,805) 1.57 (2,228) 2.11

Forfeit (31,093) 1.19 (18,351) 1.26

At end of year 81,376 1.26 147,996 1.30

Exercisable at end of year 10,285 1.75 28,805 1.57

Range of exercise prices for the Irish Sharesave Scheme (expressed in euro)

At end of year Exercisable at end of year

Number

outstanding

Weighted

average

contract life

years

Weighted

average

exercise price

€

Number

exercisable

Weighted

average

exercise price

€

At 30 September 2022

€1.01-€2.00 81,376 1.13 1.26 10,285 1.75

81,376 1.13 1.26 10,285 1.75

At 24 September 2021

€1.01-€2.00 147,996 1.82 1.30 28,805 1.57

147,996 1.82 1.30 28,805 1.57

Employee Share Incentive Plan

In January 2022, the Group launched a new share scheme for all UK employees. The number of shares is calculated at market value on the

date of allocation, to be held by a Trustee for the benefit of individual participants without any additional performance conditions other than

three years of service. The shares vest after three years but are forfeit should an employee voluntarily leave the Group within the three year

time period, subject to normal ‘good leaver’ provisions. The charge recognised in the Group Income Statement was £0.4m.

The share price on the grant date, for awards granted in January 2022 was £1.35.

The following table illustrates the number of, and movements in, share awards during the year under the plan:

2022

Number

outstanding

At beginning of year –

Granted 2,180,216

Exercised (18,768)

Forfeit (250,056)

At end of year 1,911,392

Exercisable at end of year –

147Strategic Report | Directors’ Report | Financial Statements

Weighted average assumptions used to value the share schemes

Annual Bonus Plan and Employee Share Incentive Plan

The fair value of awards granted under the Annual Bonus Plan and the Employee Share Incentive Plan are equal to the share price on the

grant date.

Performance Share Plan

All vesting conditions relating to the awards will be equally weighted when assessing the fair value at grant date. In the current year, this was

December 2021. The TSR component has been valued using a Monte Carlo simulation model which also incorporates the relative volatility of

the identified peer group with whom the Group are compared to assess the TSR vesting condition. The following table shows the weighted

average assumptions used to fair value the equity settled awards granted.

FY22

PSP TSR

FY21

PSP TSR

one year

vesting

FY21

PSP TSR

two year

vesting

FY21

PSP TSR

three year

vesting

Dividend yield (%) 2.39% 0% 0.54% 1.47%

Expected volatility (%) 40.63% 52.46% 42.66% 44.71%

Risk-free interest rate (%) 0.52% (0.13%) (0.13%) (0.03%)

Expected life of option (years) 3 1 2 3

Holding period (years) 0 2 1 0

Share price at grant (£) £1.33 £1.10 £1.10 £1.10

Fair value (£) £0.59 £0.32 £0.21 £0.17

Sharesave Schemes

The Sharesave Schemes equity settled options are also valued at the fair value on grant date, which was in July 2022 in the current year, and

are calculated by applying a trinomial model. The following table shows the weighted average assumptions used to fair value the equity

settled options granted.

2022

UK Sharesave

2021

UK Sharesave

Dividend yield (%) 4.31% 1.24%

Expected volatility (%) 39.70% 45.72%

Risk-free interest rate (%) 1.75% 0.13%

Employee failure-to-save rate (p.a.) (%) 20.63% 20.63%

Expected life of option (years) 3 3

Share price at grant (£) £0.96 £1.30

Exercise price (£) £0.91 £1.06

Fair value (£) £0.11 £0.46

The expected volatility is estimated based on the historic volatility of the Company’s share price over a period equivalent to the life of the

relevant option. The risk-free rate of return is the yield on a government bond of a term consistent with the life of the option.

The range of the Company’s share price during the year was £0.71 – £1.47 (2021: £0.89 – £1.71). The average share price during the 2022

financial year was £1.17 (2021: £1.31).

7. Exceptional items

Exceptional items are those which, as set out in our accounting policy, are disclosed separately by virtue of their nature or amount. Such items

are included within the Group Income Statement caption to which they relate.

The Group reports the following exceptional items:

2022

£m

2021

£m

Reorganisation costs (A) (16.1) –

Restructuring costs for legacy defined benefit pension schemes (B) (0.4) (4.0)

Profit on disposal of Molasses trading businesses (C) – 11.3

Non-core property related income (D) – 3.3

Legacy business provisions (E) – 1.1

Total exceptional items before taxation (16.5) 11.7

Tax credit on exceptional items 3.0 0.4

Total exceptional items (13.5) 12.1

148 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

7. Exceptional items continued

(A) Reorganisation costs

In the current year, the Group commenced a change programme “Better Greencore”, which is to support revitalisation of its excellence cost

efficiency programmes and unlock cost efficiencies by reducing organisational complexity. The Group recognised a charge of £8.5m in

respect of consultancy fees and £7.6m in respect of personnel exit costs. Better Greencore is expected to continue in FY23 with a focus on

operational and technological excellence as part of the next phase of the programme.

(B) Restructuring costs for legacy defined benefit pension schemes

The Group incurred a charge of £0.4m in the current year and £4.0m in the prior year in relation to restructuring costs associated with its

legacy defined benefit pension schemes in Ireland.

In the prior year, the Group completed the disposal of its interest in the Molasses trading businesses recognising a profit on disposal of £11.3m.

(D) Non-core property related income

In the prior year, the Group recognised a reversal of an impairment of £3.3m prior to the disposal of an investment property in the UK.

(E) Legacy business provisions

During the prior year, the Group recognised a net credit of £1.1m relating to legacy provisions on discontinued operations.

Cash flow on exceptional items

The total net cash outflow during the year in respect of exceptional charges was £13.6m (2021: £3.3m), of which £0.8m was in respect of prior

year exceptional charges.

8. Finance costs and finance income

2022

£m

2021

£m

Finance income

Interest on bank deposits 0.2 –

Foreign exchange on inter-company and external balances where hedge accounting is not applied – 0.1

Total finance income 0.2 0.1

Finance costs

Finance costs on interest bearing cash and cash equivalents, borrowings and other financing costs (11.3) (15.0)

Interest on lease obligations (Note 14) (1.2) (1.3)

Net pension financing charge (Note 24) (1.1) (1.7)

Unwind of discount on liabilities (0.1) (0.1)

Change in fair value of derivatives and related debt adjustment 1.9 (1.0)

Foreign exchange on inter-company and external balances where hedge accounting is not applied (0.7) –

Total finance costs (12.5) (19.1)

Recognised directly in equity

Currency translation adjustment 1.8 (3.0)

Effective portion of changes in fair value of cash flow hedges 8.5 (0.5)

10.3 (3.5)

There were £0.4m of interest costs capitalised in the year (2021: £Nil)

149Strategic Report | Directors’ Report | Financial Statements

9. Taxation

2022

£m

2021

£m

Current tax

Corporation tax charge – 0.4

Overseas tax charge 6.6 2.7

Adjustment in respect of prior years (3.8) (4.7)

Total current tax charge/(credit) (pre-exceptional) 2.8 (1.6)

Deferred tax

Origination and reversal of temporary differences 2.9 2.4

Legacy defined benefit pension obligations 2.6 0.9

Effect of tax rate change 1.5 (2.5)

Employee share-based payments (0.1) (0.1)

Adjustment in respect of prior years 0.8 3.4

Total deferred tax charge (pre-exceptional) 7.7 4.1

Income tax expense (pre-exceptional) 10.5 2.5

Tax on exceptional items

Current tax credit (2.9) –

Deferred tax credit (0.1) (0.4)

Tax credit on exceptional items (3.0) (0.4)

Total tax charge for the year 7.5 2.1

Tax relating to items taken directly to equity

Deferred tax relating to items taken directly to equity

Effect of tax rate change – (5.5)

Actuarial gain on Group legacy defined benefit pension schemes 4.1 6.6

Employee share-based payments 0.1 (0.2)

Total deferred tax charge in equity for the year 4.2 0.9

Reconciliation of total tax charge

The tax charge for the year can be reconciled to the profit per the Group Income Statement as follows:

2022

£m

2021

£m

Profit for the financial year 32.3 25.7

Adjusted For:

Tax charge for the year 7.5 2.1

Profit before tax 39.8 27.8

Tax charge at Irish corporation tax rate of 12.5% (2021:12.5%) 5.0 3.5

Effects of:

Expenses not deductible for tax purposes 0.7 3.1

Differences in effective tax rates on overseas earnings 2.9 1.6

Effect of current year losses not recognised 0.4 –

Utilisation of losses not previously recognised – (0.5)

Effect of rate change in the UK 1.5 (2.5)

Non-taxable exceptional items – (1.8)

Adjustment in respect of prior years (3.0) (1.3)

Total tax charge for the year 7.5 2.1

150 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

9. Taxation continued

Deferred taxation

The Group’s deferred tax assets and liabilities are analysed as follows:

Property,

plant and

equipment

£m

Acquisition

intangibles

£m

Retirement

benefit

obligations

£m

Tax

losses

£m

Employee

share-

based

payment

£m

Other

£m

Total

£m

Year ended 30 September 2022

At 24 September 2021 (9.5) (3.6) 16.7 23.2 0.5 2.6 29.9

Income Statement (charge)/credit (1.8) 0.9 (2.6) (4.5) 0.1 0.2 (7.7)

Tax recorded in equity – – (4.1) – (0.1) – (4.2)

Exceptional items (Note 7) – – – 0.1 – – 0.1

Currency translation adjustment and other – – (0.1) 0.1 – 0.1 0.1

At 30 September 2022 (11.3) (2.7) 9.9 18.9 0.5 2.9 18.2

Deferred tax assets (deductible temporary differences) – – 14.8 18.9 0.5 2.9 37. 1

Deferred tax liabilities (taxable temporary differences) (11.3) (2.7) (4.9) – – – (18.9)

Net deferred tax asset/(liability) (11.3) (2.7) 9.9 18.9 0.5 2.9 18.2

Property,

plant and

equipment

£m

Acquisition

intangibles

£m

Retirement

benefit

obligations

£m

Tax

losses

£m

Employee

share-based

payment

£m

Other

£m

Total

£m

Year ended 24 September 2021

At 25 September 2020 (2.9) (3.5) 18.3 20.2 0.3 1.8 34.2

Income Statement (charge)/credit (7.0) (0.1) (0.9) 3.0 – 0.9 (4.1)

Tax recorded in equity – – (1.1) – 0.2 – (0.9)

Exceptional items – – 0.4 – – – 0.4

Disposals 0.4 – – – – – 0.4

Currency translation adjustment and other – – – – – (0.1) (0.1)

At 24 September 2021 (9.5) (3.6) 16.7 23.2 0.5 2.6 29.9

Deferred tax assets (deductible temporary differences) – – 21.8 23.2 0.5 2.6 48.1

Deferred tax liabilities (taxable temporary differences) (9.5) (3.6) (5.1) – – – (18.2)

Net deferred tax asset/(liability) (9.5) (3.6) 16.7 23.2 0.5 2.6 29.9

The Group has not provided deferred tax in relation to temporary differences of approximately £300m (2021: £300m) applicable to

investments in subsidiaries on the basis that the Group can control the timing and realisation of these temporary differences, and it is probable

that the temporary difference will not reverse in the foreseeable future. No provision has been recognised in respect of deferred tax relating to

unremitted earnings of subsidiaries as there is no commitment to remit earnings.

No deferred tax asset is recognised in respect of certain tax losses and other attributes incurred by the Group on the grounds that there is

insufficient evidence that the assets will be recoverable. In the event that sufficient profits are generated in the relevant jurisdictions in the

future, these assets may be recovered. The unrecognised deferred tax asset at 30 September 2022 was £42.2m (2021: £37.7m) which has been

calculated based on the tax rate applicable to the jurisdiction to which the losses relate and has been translated to the Group presentation

currency at the closing rate on 30 September 2022.

The total gross unrecognised tax losses are £197.3m (2021: £201.4m). There is no expiry date for losses in any jurisdiction. Deferred tax assets,

to the extent that the Directors consider they are recoverable, have been recognised. The unrecognised deferred tax asset at 30 September

2022 in respect of capital losses was £14.3m (2021: £14.5m), which has been translated to the Group’s presentation currency translated at the

closing rate at 30 September 2022 and which corresponds to gross unrecognised tax losses of £54.7m (2021: £55.6m). Recognition of

deferred tax assets is a key judgement in the Group Financial Statements as disclosed in Note 1.

151Strategic Report | Directors’ Report | Financial Statements

Factors that may impact future tax charges and other disclosures

The tax charge in future periods will be impacted by any changes to the corporation tax rates in force in the jurisdictions in which the Group

operates. On 3 March 2021, the UK Government announced an increase in the UK rate of corporation tax from 19% to 25%, to be effective

from 1 April 2023. Following a period of uncertainty where a reversal of the increase was proposed, this rate change was reconfirmed by the

UK Government in October 2022.

This change was enacted in the prior period, such that closing UK-related deferred tax balances have been calculated using the 25% tax rate

where appropriate. Also in the prior period, the UK Government announced the introduction of a new relief for certain capital expenditure.

The new ‘superdeduction’ gives an incremental deduction of an additional 30% of qualifying cost. The superdeduction applies for qualifying

expenditure incurred between 1 April 2021 and 31 March 2023. The Group has made initial claims for qualifying expenditure incurred in FY21

and will make additional claims for FY22 and FY23 in due course. Any claim for the superdeduction will have the effect of reducing the

effective tax rate in periods claimed.

The Organisation for Economic Cooperation & Development (‘OECD’) announced on 8 October 2021 that, effective from 2023, its members

had agreed to set a global corporate minimum tax rate of 15%. The implementation of these rules, referred to as ‘Pillar Two’ is expected to be

effective for accounting periods commencing on or after 31 December 2023 and will therefore impact the Group in the accounting period

ending September 2025. The Group is headquartered and has operations in Ireland, which currently has a corporation tax rate of 12.5%. Whilst

there has been no proposal to raise the Irish rate of corporation tax, it is likely that the implementation of the Pillar Two rules may impact the

Group’s tax charge in future periods. The Group will evaluate the impact as the implementation date approaches.

The Group is subject to income tax in different jurisdictions. Judgement is required in determining the Group’s provision for income taxes and

deferred taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course

of business. The Group recognises liabilities for uncertain tax positions based on estimates of whether additional taxes will be due, using the

method that we expect to better predict the resolution of the uncertainty in each case. Where the final tax outcome of these matters is

different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in

which such determination is made. Adjustments in respect of prior periods arose largely on the closure of open periods.

10. Earnings per Ordinary Share

Basic earnings per Ordinary Share is calculated by dividing the profit attributable to equity holders of the Company by the weighted average

number of Ordinary Shares in issue during the year, excluding Ordinary Shares purchased by the Company and held in trust in respect of the

Annual Bonus Scheme and the Performance Share Plan.

Diluted earnings per Ordinary Share is calculated by adjusting the weighted average number of Ordinary Shares outstanding to assume

conversion of all dilutive potential Ordinary Shares.

The numerator for adjusted basic earnings per share is calculated as profit attributable to equity holders of the Company adjusted to exclude

exceptional items (net of tax), the effect of foreign exchange (‘FX’) on inter-company and certain external balances where hedge accounting is

not applied, the movement in the fair value of all derivative financial instruments and related debt adjustments, the amortisation of acquisition

related intangible assets (net of tax) and the effect of interest expense relating to legacy defined benefit pension liabilities (net of tax).

In the current year, the Group repurchased 9,728,677 Ordinary Shares in the Company, by way of a share buyback, costing £8.8m. These

shares were immediately cancelled. The effect of this on the weighted average number of ordinary shares was a decrease of 774,827 shares.

In the prior year, the Group raised £90.0m by way of an equity placing completed on 26 November 2020. The Group issued 80,357,142

Ordinary Shares in the Company on the London Stock Exchange, at a placing price of 112 pence per Ordinary Share. The effect of this on the

weighted average number of ordinary shares was an increase of 66,707,436 shares.

The total Ordinary Shares in issue at 30 September 2022 was 516,836,560 (2021: 526,546,662).

Numerator for earnings per share and adjusted earnings per share calculations

2022

£m

2021

£m

Profit attributable to equity holders of the Company (numerator for earnings per share calculations) 32.3 25.4

Exceptional items (net of tax) 13.5 (12.1)

Movement in fair value of derivative financial instruments and related debt adjustments (1.9) 1.0

FX effect on inter-company and external balances where hedge accounting is not applied 0.7 (0.1)

Amortisation of acquisition related intangible assets (net of tax) 2.7 3.2

Pension financing (net of tax) 0.8 1.4

Numerator for adjusted earnings per share calculations 48.1 18.8

152 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

10. Earnings per Ordinary Share continued

Denominator for basic earnings per share and adjusted earnings per share calculations

2022

‘000

2021

‘000

Shares in issue at the beginning of the year 526,547 446,157

Effect of shares held by Employee Benefit Trust (2,403) (1,116)

Effect of shares issued during the year 13 16

Effect of share buyback and cancellation in the year (775) –

Effect of shares issued in equity placing in the year – 66,707

Weighted average number of Ordinary Shares in issue during the year 523,382 511,764

Denominator for diluted earnings per share calculations

Employee Performance Share Plan awards, which are performance based, are treated as contingently issuable shares, because their issue is

contingent upon satisfaction of specified performance conditions in addition to the passage of time. These contingently issuable Ordinary

Shares are excluded from the computation of diluted earnings per Ordinary Share where the conditions governing exercisability have not been

satisfied as at the end of the reporting period.

A total of 17,031,830 (2021: 11,843,501) unvested shares were excluded from the diluted earnings per share calculation as they were either

antidilutive or contingently issuable Ordinary Shares which had not satisfied the performance conditions attaching at the end of the 2022

financial year.

A reconciliation of the weighted average number of Ordinary Shares used for the purpose of calculating the diluted earnings per share

amounts is as follows:

2022

‘000

2021

‘000

Weighted average number of Ordinary Shares in issue during the year 523,382 511,764

Dilutive effect of share options 2,123 660

Weighted average number of Ordinary Shares for diluted earnings per share 525,505 512,424

Earnings per share calculations

2022

Total

pence

2021

Total

pence

Basic earnings per Ordinary Share 6.2 5.0

Adjusted earnings per Ordinary Share 9.2 3.7

Diluted earnings per Ordinary Share 6.1 5.0

11. Dividends paid and proposed

There were no dividends paid in the current or prior year and there are no dividends proposed to be paid.

In the current year, the first phase of the value return to shareholders completed with £8.8m value returned up to 30 September 2022 in the

form of a share buyback, with £10.0m buyback completed on 6 October 2022. As announced in May 2022, it is the Group’s intention to return

£50.0m of value to shareholders over the next two years, with the Group planning to return £15.0m in 2023.

153Strategic Report | Directors’ Report | Financial Statements

12. Goodwill and intangible assets

Goodwill

£m

Acquisition

intangible assets

– customer

£m

Computer

software and

other

intangibles

£m

Total

£m

Year ended 30 September 2022

At 24 September 2021 449.4 14.7 9.2 473.3

Additions – – 1.5 1.5

Amortisation charge – (3.6) (3.1) (6.7)

Currency translation adjustment – – – –

At 30 September 2022 449.4 11.1 7.6 468.1

Year ended 30 September 2022

Cost 460.0 52.3 20.6 532.9

Accumulated impairment/amortisation (10.6) (41.2) (13.0) (64.8)

At 30 September 2022 449.4 11.1 7.6 468.1

Goodwill

£m

Acquistion

related intangible

assets

- customer

£m

Compuer

software and

other

intangibles

£m

Total

£m

Year ended 24 September 2021

At 25 September 2020 449.6 18.6 10.3 478.5

Additions – – 2.0 2.0

Amortisation charge – (3.9) (3.1) (7.0)

Currency translation adjustment (0.2) – – (0.2)

At 24 September 2021 449.4 14.7 9.2 473.3

Year ended 24 September 2021

Cost 460.0 52.3 23.0 535.3

Accumulated impairment/amortisation (10.6) (37.6) (13.8) (62.0)

At 24 September 2021 449.4 14.7 9.2 473.3

Goodwill and impairment testing

Goodwill acquired in business combinations is allocated, at acquisition, to the cash generating units (‘CGU’s) that are expected to benefit from

that business combination. The Group has allocated goodwill to its two CGUs, Convenience Foods UK and Ingredients and Property trading

businesses. The CGUs represent the lowest level within the Group at which the associated goodwill is assessed for internal management

purposes and are not larger than the operating segment determined in accordance with IFRS 8 Operating Segments. A summary of the

allocation of the carrying value of goodwill by CGU is as follows:

2022

£m

2021

£m

Convenience Foods UK 447.4 4 47.4

Ingredients and Property 2.0 2.0

449.4 449.4

The recoverable amount of the Group’s CGUs has been determined based on a value in use calculation. The cash flow forecasts employed for

this calculation are based on the approved FY23 budget and two year strategic plan and specifically excludes incremental profits and other

cash flows stemming from any potential future acquisitions. A long term growth rate of 2% (2021: 2%) is then applied to the year three cash

flows.

A present value of the future cash flows is calculated using a pre-tax discount rate which represents the Group’s pre-tax weighted average

cost of capital calculated using the Capital Asset Pricing Model, adjusted to reflect risks associated with the CGUs. The discount rate applied to

the Convenience Foods UK CGU was 11% (2021: 10%) and to Ingredients and Property CGU was 10% (2021: 9%).

154 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

12. Goodwill and intangible assets continued

The market capitalisation of the Group at 30 September 2022 was below the Group’s net asset value at that date, which is an indicator of

impairment. This has been considered in the impairment testing performed. Assumptions underpinning the projected cashflows include

management’s estimates of future profitability, long term growth rates and discount rates. The cash flow forecasts and key assumptions are

generally determined based on historical performance together with management’s expectation of future trends consistent with external

sources of information pertaining to estimated growth of the UK convenience food market as well as the Irish Ingredients market. In the

current year, the cash flow forecasts reflect the uncertainty in the external economic environment including the impact of inflation and cost

ofliving.

Applying these techniques, no impairment charge arose in 2022 (2021: £Nil).

The table below sets out the approach used to determine the values assigned to each key assumption for the purpose of impairment testing

for the Convenience Foods UK CGU and the Ingredients and Property CGU:

Key assumptions Basis for determining values assigned to key assumptions

Profitability growth

Future profitability is based on the FY23 budget and FY24 and FY25 strategic plan which have been adjusted to

take into account the potential impact of the recessionary environment and cost of living factors.

Long term growth rate

A long-term growth rate of 2% (FY21: 2%) has been used in extrapolating the cashflows from 2025 to perpetuity.

While there is uncertainty in the short term in the external economic environment, the Group has determined

that 2% is representative of the rate that will apply in the longer term.

Discount rate

The discount rate has increased in the current year for the Convenience Foods UK CGU and Ingredients and

Property CGU, from 10% and 9% at 24 September 2021 to 11% and 10% respectively at 30 September 2022.

This reflects the economic uncertainty in the market place.

Sensitivity analysis

Sensitivity analysis has been carried out on each of the key assumptions used in the value in use calculation for each CGU. Changes in the

assumptions would lead to an impairment where there is a decline of 30% in projected cash flows, a reduction in the inflationary linked long

term growth rate by 344 bps or an increase in the discount rate by 397 bps. Notwithstanding this analysis the Group believes that any

reasonable change in the assumptions applied would not give rise to the carrying value of goodwill exceeding the recoverable amount of

each CGU.

13. Property, plant and equipment

Land and

buildings

£m

Plant and

machinery

£m

Fixtures and

fittings

£m

Capital work

in progress

£m

Total

£m

Year ended 30 September 2022

At 24 September 2021 154.6 119.1 16.3 17.4 307.4

Additions 0.2 1.7 0.8 46.2 48.9

Depreciation charge (10.9) (19.8) (5.3) – (36.0)

Impairments (0.2) (0.6) (0.1) – (0.9)

Reclassifications 14.8 34.1 1.0 (49.9) –

At 30 September 2022 158.5 134.5 12.7 13.7 319.4

Year ended 30 September 2022

Cost 256.5 315.2 46.7 13.7 632.1

Accumulated depreciation (98.0) (180.7) (34.0) – (312.7)

At 30 September 2022 158.5 134.5 12.7 13.7 319.4

155Strategic Report | Directors’ Report | Financial Statements

Land and

buildings

£m

Plant and

machinery

£m

Fixtures and

fittings

£m

Capital work

in progress

£m

Total

£m

Year ended 24 September 2021

At 25 September 2020 161.6 122.3 19.9 9.4 313.2

Additions – 1.9 0.7 31.3 33.9

Depreciation charge (10.7) (18.9) (5.7) – (35.3)

Impairments (0.7) (3.6) (0.1) – (4.4)

Reclassifications 4.4 17.4 1.5 (23.3) –

At 24 September 2021 154.6 119.1 16.3 17.4 307.4

Year ended 24 September 2021

Cost 241.5 279.4 44.9 17.4 583.2

Accumulated depreciation (86.9) (160.3) (28.6) – (275.8)

At 24 September 2021 154.6 119.1 16.3 17.4 307.4

At 30 September 2022, the Group’s market capitalisation was lower than the Group’s net assets which is an indicator of impairment and

therefore an impairment review was performed. The Group recognised an impairment charge of £0.9m (2021: £4.4m) following review.

Thiswas charged to operating costs in the Group Income Statement in both the current and the prior year.

14. Leases

The movement in the Group’s right-of-use assets during the year is as follows:

Land and

buildings

£m

Plant and

machinery

£m

Motor

vehicles

£m

Total

£m

Year ended 30 September 2022

At 24 September 2021 34.5 8.6 11.0 54.1

Additions 0.4 2.6 3.8 6.8

Disposals – (0.3) (0.6) (0.9)

Depreciation charge for the year (5.6) (3.3) (6.7) (15.6)

Right-of-use assets at 30 September 2022 29.3 7.6 7.5 44.4

Land and

buildings

£m

Plant and

machinery

£m

Motor

vehicles

£m

Total

£m

Year ended 24 September 2021

At 25 September 2020 36.4 5.1 14.1 55.6

Additions 4.5 6.3 4.2 15.0

Disposals (0.8) (0.1) (0.7) (1.6)

Depreciation charge for the year (5.6) (2.7) (6.6) (14.9)

Right-of-use assets at 24 September 2021 34.5 8.6 11.0 54.1

The movement in the Group’s lease liabilities during the year is as follows:

2022

£m

2021

£m

At beginning of year 59.6 60.7

Additions 6.6 14.6

Disposals (0.9) (1.4)

Payments for lease liabilities (17.3) (14.3)

Payments for lease interest (1.2) (1.3)

Lease interest charge 1.2 1.3

At end of year 48.0 59.6

156 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

14. Leases continued

An analysis of the maturity profile of the discounted lease liabilities arising from the Group’s leasing activities is as follows:

2022

£m

2021

£m

Within one year 14.4 17.6

Between one and five years 26.3 31.5

Over 5 years 7.3 10.5

Total 48.0 59.6

Analysed as:

Current liabilities 14.4 17.6

Non-current liabilities 33.6 42.0

Total 48.0 59.6

The Group avails of the exemption from capitalising lease costs for short-term leases and low-value assets where the relevant criteria are met.

The following lease costs have been charged to the Group Income Statement as incurred:

2022

£m

2021

£m

Short-term leases 5.4 0.9

Leases of low-value assets 0.2 0.1

Total 5.6 1.0

The total cash outflow for lease payments during the year was as follows:

2022

£m

2021

£m

Cash outflow for short-term leases and leases of low value 5.6 1.0

Lease payments relating to capitalised right-of-use leased assets 17.3 14.3

Interest payments relating to lease obligations 1.2 1.3

Total 24.1 16.6

15. Investment property

2022

£m

2021

£m

At beginning of the year 3.0 6.1

Reversal of impairment – 3.3

Disposal – (6.3)

Currency translation adjustment 0.1 (0.1)

At end of year* 3.1 3.0

Analysed as:

Cost 3.1 3.0

Accumulated depreciation – –

At end of year* 3.1 3.0

* The majority of the Group’s investment property is land and therefore not depreciated.

The carrying value of the Group’s investment properties at 30 September 2022 was £3.1m (2021: £3.0m) which reflects its fair value. The

valuations were carried out by the Group using external independent valuers and property brokers and was arrived at by reference to location,

market conditions and status of planning applications. The fair values of investment properties are considered a Level 3 fair value disclosure.

In the prior year, £3.3m of impairment was reversed following a review of the recoverable value of an investment property at Corby,

Northamptonshire, UK. The property was sold for £6.3m in September 2021.

An increase or decrease in the price per hectare of 5% would result in a 5% or £0.2m increase or decrease in the fair value of the land.

157Strategic Report | Directors’ Report | Financial Statements

16. Inventories

2022

£m

2021

£m

Raw materials and consumables 38.2 27.3

Work in progress 0.4 0.3

Finished goods and goods for resale 24.7 20.1

63.3 47.7

None of the above carrying amounts have been pledged as security for liabilities entered into by the Group.

Inventory recognised within cost of sales 847.4 628.1

The amount recognised as an expense for inventory write-downs for the year, was £4.5m (2021: £4.3m).

17. Trade and other receivables

2022

£m

2021

£m

Current

Trade receivables 179.5 145.6

Other receivables 42.5 31.5

Prepayments 14.5 12.2

VAT 12.1 6.8

Contract costs 0.1 0.2

Total 248.7 196.3

The fair value of current receivables approximates book value due to their size and short-term nature.

Approximately £36.0m (2021: £36.0m) of the Group’s trade receivables are secured against pension liabilities. See Note 24 for further details.

The Group’s exposure to credit and currency risk and impairment losses related to trade receivables and other receivables is set out in Note 22.

18. Trade and other payables

2022

£m

2021

£m

Current

Trade payables 295.8 238.1

Employment related taxes 11.7 8.6

Other payables and accrued expenses 137.6 129.1

Subtotal – current 445.1 375.8

Non-current

Other payables 2.7 3.7

Total 447.8 379.5

The Group’s exposure to liquidity and currency risk is disclosed in Note 22.

19. Cash and cash equivalents and bank overdrafts

2022

£m

2021

£m

Cash at bank and in hand 99.6 119.1

Cash at bank earns interest at floating rates based on daily bank deposit rates. Short-term deposits are made for varying periods, between one

day and one month, depending on the immediate cash requirements of the Group, and earn interest at the respective short-term deposit

rates. The fair value of cash and cash equivalents equals the carrying amount.

For the purposes of the Group Statement of Cash Flows, cash and cash equivalents and bank overdrafts are presented net as follows:

2022

£m

2021

£m

Cash at bank and in hand 99.6 119.1

Bank overdraft (Note 20) (52.9) (45.5)

Total cash and cash equivalents and bank overdrafts 46.7 73.6

158 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

20. Borrowings

2022

£m

2021

£m

Current

Bank overdrafts 52.9 45.5

Private placement notes 16.9 47.6

Total current borrowings 69.8 93.1

Non-current

Bank borrowings 158.8 150.1

Private placement notes 51.0 59.0

Total non-current borrowings 209.8 209.1

Total borrowings 279.6 302.2

The maturity of borrowings is as follows:

2022

£m

2021

£m

Less than 1 year 69.8 93.1

Between 1 and 2 years 111.9 64.6

Between 2 and 5 years 97.9 144.5

279.6 302.2

The exposure of the Group’s borrowings to interest rate changes and the contractual repricing dates at the statement of financial position date

are as follows:

2022

£m

2021

£m

6 months or less 158.8 150.1

1 – 5 years 67.9 106.6

226.7 256.7

The average spread that the Group paid on its financing facilities in the year ended 30 September 2022 was 2.16% (2021: 3.41%).

Bank overdrafts are part of the Group cash pooling arrangement and therefore are not exposed to interest rate changes.

Bank borrowings

The Group’s bank borrowings are denominated in sterling. At 30 September 2022 interest is set at commercial rates based on a spread above

SONIA.

The Group’s bank borrowings, net of finance fees comprised of £158.8m at 30 September 2022 (September 2021: £150.1m) with maturities

ranging from March 2023 to January 2026, the earliest of which is the Group’s £75.0m revolving credit bank facility which matures in March

2023 and has not been drawn to date. The Group had £350.0m (September 2021: £360.0m) of undrawn committed bank facilities in respect

of which all conditions precedent had been met. Uncommitted facilities undrawn at 30 September 2022 amounted to £9.5m (September

2021: £6.7m).

Private Placement Notes

The Group’s outstanding Private Placement Notes net of finance fees comprised of £67.9m (denominated as $55.9m and £18m) at

30 September 2022 (2021: £106.6m, denominated as $120.9m and £18m). These were issued as fixed rate debt in June 2016 ($55.9m and

£18m) with maturities ranging between June 2023 and June 2026. The Group repaid the $65m Private Placement Note in full in October 2021.

The Group has swapped the $55.9m Private Placement Notes from fixed rate US Dollar to fixed rate sterling using cross–currency interest rate

swaps. The fixed rate US dollar to fixed rate sterling swaps are designated as cash flow hedges.

Guarantees

The Group’s financing facilities are secured by guarantees from Greencore Group plc and cross-guarantees from various companies within

the Group. The Group treats these guarantees as insurance contracts and accounts for them as such.

159Strategic Report | Directors’ Report | Financial Statements

Interest rate profile

The interest rate profile of cash and cash equivalents and borrowings at 30 September 2022 was as follows:

Australian dollar

£m

US dollar

£m

Euro

£m

Sterling

£m

Total

£m

Floating rate net debt 0.1 (1.4) 5.8 (26.5) (22.0)

Fixed rate net debt – (50.0) – (108.0) (158.0)

Total 0.1 (51.4) 5.8 (134.5) (180.0)

The interest rate profile of cash and cash equivalents and borrowings at 24 September 2021 was as follows:

Australian dollar

£m

US dollar

£m

Euro

£m

Sterling

£m

Total

£m

Floating rate net debt 0.2 – 4.9 18.9 24.0

Fixed rate net debt – (88.6) – (118.5) (207.1)

Total 0.2 (88.6) 4.9 (99.6) (183.1)

21. Derivative financial instruments

Derivative financial instruments recognised as assets and liabilities in the Statement of Financial Position are analysed as follows:

2022

Assets

£m

Liabilities

£m

Net

£m

Current

Cross-currency interest rate swaps – cash flow hedges 1.5 – 1.5

Forward foreign exchange contracts – not designated as hedges 1.0 (0.1) 0.9

2.5 (0.1) 2.4

Non-current

Cross-currency interest rate swaps – cash flow hedges 5.9 – 5.9

Interest rate swaps – cash flow hedges 6.4 – 6.4

Forward foreign exchange contracts – not designated as hedges 0.1 – 0.1

12.4 – 12.4

Total 14.9 (0.1) 14.8

2021

Assets

£m

Liabilities

£m

Net

£m

Current

Cross-currency interest rate swaps – cash flow hedges – (2.1) (2.1)

Interest rate swaps – cash flow hedges – (0.5) (0.5)

Forward foreign exchange contracts – not designated as hedges – (0.3) (0.3)

– (2.9) (2.9)

Non-current

Cross-currency interest rate swaps – cash flow hedges – (2.6) (2.6)

Interest rate swaps – cash flow hedges – (0.1) (0.1)

– (2.7) (2.7)

Total – (5.6) (5.6)

160 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

21. Derivative financial instruments continued

Derivative instruments which are held for trading and are not designated as effective hedging instruments are classified as a current asset or

liability (as appropriate) regardless of maturity if the Group expects that they may be settled within 12 months of the date. Derivative

instruments that are designated as effective hedging instruments are classified as a current or non-current asset or liability by reference to the

maturity of the hedged item. All other derivative instruments are classified by reference to their maturity date.

Cross-currency interest rate swaps

The Group utilises cross currency interest rate swaps to convert fixed rate US dollar Private Placement Notes into fixed rate sterling liabilities.

Interest rate swaps

The Group utilises interest rate swaps to convert floating rate sterling into fixed rate debt liabilities.

The principal amount of the Group’s borrowings which are swapped at 30 September 2022 total £90.0m (2021: £100.0m). At 30 September

2022, the fixed interest rates varied from 0.504% to 0.660% (2021: 0.504% to 2.095%) which mature in October 2023 and October 2024.

Forward foreign exchange contracts

The notional principal amounts of outstanding forward foreign exchange contracts at 30 September 2022 total £47.4m (2021: £32.2m). No

outstanding forward foreign exchange contracts are designated as cash flow hedges as at 30 September 2022 (2021: £Nil).

22. Financial risk management and financial instruments

Financial risk management objectives and policies

The Group’s activities expose it to a variety of financial risks that include interest rate risk, foreign currency risk, liquidity risk, credit risk and

price risk. These financial risks are actively managed by the Group’s treasury and purchasing departments under strict policies and guidelines

approved by the Board of Directors. The Group’s treasury department actively monitors market conditions with a view to minimising the

exposure of the Group to changing market factors while at the same time minimising the volatility of the funding costs of the Group. The

Group uses derivative financial instruments such as foreign currency contracts, cross-currency swaps and interest rate swaps to manage the

financial risks associated with the underlying business activities of the Group.

Financial instruments that are carried at fair value, use different valuation methods. The different levels have been defined as follows:

Level 1: Quoted prices (unadjusted) in active markets for identical assets and liabilities.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or

indirectly (i.e. derived from prices).

Level 3: Inputs for the asset or liability that are not observable market data (un-oberservable inputs).

The fair value of the financial liabilities held at amortised cost and the financial liabilities in fair value hedges are within Level 2 of the fair value

hierarchy and have been calculated by discounting the expected future cash flows at prevailing interest rates and by applying period end

exchange rates.

2022

Loans and

receivables

£m

FV through

profit or loss

£m

Cash flow

hedges

£m

Financial

liabilities at

amortised cost

£m

Carrying

value

£m

Fair

value

£m

Cash and cash equivalents* 99.6 – – – 99.6 99.6

Bank overdrafts* – – – (52.9) (52.9) (52.9)

Derivative financial instruments** – 1.0 13.8 – 14.8 14.8

Bank borrowings** – – – (158.8) (158.8) (151.1)

Private Placement Notes** – – – (67.9) (67.9) (65.3)

* Level 1

** Level 2

2021

Loans and

receivables

£m

FV through

profit or loss

£m

Cash flow

hedges

£m

Financial

liabilities at

amortised cost

£m

Carrying

value

£m

Fair

value

£m

Cash and cash equivalents* 119.1 – – – 119.1 119.1

Bank overdrafts* – – – (45.5) (45.5) (45.5)

Derivative financial instruments** – (0.3) (5.3) – (5.6) (5.6)

Bank borrowings** – – – (150.1) (150.1) (146.6)

Private Placement Notes** – – – (106.6) (106.6) (107.7 )

* Level 1

** Level 2

161Strategic Report | Directors’ Report | Financial Statements

The carrying value of trade and other receivables and trade and other payables are considered a reasonable approximation of fair value and

therefore have not been included in the tables above.

During the year and prior year, there were no transfers between the different levels identified above.

Interest rate risk

The Group’s exposure to market risk for changes in interest rates arises from its floating rate borrowings, cash and cash equivalents and derivatives.

The Group’s policy is to optimise interest cost and reduce volatility in reported earnings. This is managed by reviewing the debt profile of the

Group regularly on a currency by currency basis and by selectively using interest rate swaps to manage the level of floating interest rate exposure.

The Group holds private placement in US dollars which have been swapped to sterling using cross currency interest rate swaps.

Sensitivity analysis for floating rate debt

The full year impact of both an upward and downward movement in each applicable interest rate and interest rate curve by 100 basis points

(assuming all the other variables remain constant) is shown below.

On profit after tax On equity

2022

£m

2021

£m

2022

£m

2021

£m

Effect of a downward movement of 100 basis points 0.7 – (0.6) (2.2)

Effect of an upward movement of 100 basis points (0.7) (0.5) 0.5 1.7

negative = cost, positive = gain

Foreign currency risk

The Group is exposed to currency risk on sales and purchases in certain businesses that are denominated in currencies other than the

functional currency of the entity concerned. The Group utilises foreign currency contracts to economically hedge foreign exchange

exposures arising from these transactions.

The Group’s trading entity exposures to foreign currency risk for amounts not denominated in the functional currency of the relevant entity at

the year end date were as follows (excluding derivative financial instruments):

2022 2021

Denominated in:

Euro

£m

US dollars

£m

Sterling

£m

Euro

£m

US dollars

£m

Sterling

£m

Trade receivables and other receivables 1.8 6.6 2.5 – 6.3 0.4

Trade payables and other payables (7.0) (1.0) (1.8) (6.9) (2.0) (0.3)

Cash and cash equivalents and bank overdrafts (4.9) (1.4) (0.5) 0.5 – 0.3

Gross balance sheet exposure (10.1) 4.2 0.2 (6.4) 4.3 0.4

Sensitivity analysis for primary foreign currency risk

A 10% strengthening of the sterling exchange rate against the euro exchange rates in respect of the translation of amounts not denominated in

the functional currency of relevant entities into the functional currency would impact profit after tax and equity by the amount shown below.

This assumes that all other variables remain constant. A 10% weakening of the sterling exchange rate against the euro exchange rates would

have an equal and opposite effect.

On profit after tax On equity

2022

£m

2021

£m

2022

£m

2021

£m

Impact of 10% strengthening of sterling vs euro (loss)/gain (0.2) (0.3) 5.1 4.7

Currency profile

The currency profile of cash and cash equivalents and bank overdrafts, borrowings and derivative financial instruments at 30 September 2022

was as follows:

Australian dollar

£m

US dollar

£m

Euro

£m

Sterling

£m

Total

£m

Cash and cash equivalents and bank overdrafts 0.1 (1.4) 5.8 42.2 46.7

Current borrowings – (12.5) – (4.4) (16.9)

Non-current borrowings – (37.5) – (172.3) (209.8)

Other derivative financial instruments – – – 14.8 14.8

Total 0.1 (51.4) 5.8 (119.7) (165.2)

162 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

22. Financial risk management and financial instruments continued

Currency profile continued

The currency profile of cash and cash equivalents and bank overdrafts, borrowings and derivative financial instruments at 24 September 2021

was as follows:

Australian dollar

£m

US dollar

£m

Euro

£m

Sterling

£m

Total

£m

Cash and cash equivalents and bank overdrafts 0.2 – 4.9 68.5 73.6

Current borrowings – (47.6) – – (47.6)

Non-current borrowings – (41.0) – (168.1) (209.1)

Other derivative financial instruments – – – (5.6) (5.6)

Total 0.2 (88.6) 4.9 (105.2) (188.7)

Liquidity risk

The Group’s policy on funding capacity is to ensure that it always has sufficient long-term funding and committed bank facilities in place to

meet foreseeable peak borrowing requirements with an appropriate level of additional headroom. A prudent approach to liquidity risk

management is taken by the Group by spreading the maturities of its debt using long-term financing. The Group’s treasury department

actively monitors the current and future funding requirements of the business on a daily basis. Excess funds are placed on short-term deposit

for up to one month whilst ensuring that sufficient cash is available on demand to meet expected operational requirements.

The following are the carrying amounts and contractual liabilities of financial instruments (including interest payments):

30 September 2022

Carrying

amount

£m

Contractual

amount

£m

Period

1-6 months

£m

Period

6-12 months

£m

Period

1-5 years

£m

Period

> 5 years

£m

Non-derivative financial instruments

Bank overdrafts (52.9) (52.9) (52.9) – – –

Bank borrowings (158.8) (185.3) (4.9) (5.6) (174.8) –

Private Placement Notes (67.9) (70.8) (0.5) (17.6) (52.7) –

Lease liabilities (48.0) (51.1) (8.2) (7.2) (28.2) (7.5)

Trade and other payables (436.1) (436.1) (433.4) – (2.7) –

Derivative financial instruments

Interest rate swaps – cash flow hedges 6.4

Inflow/(outflow) 7.5 1.6 2.0 3.9 –

Cross-currency interest rate swaps – cash flow hedges 7.4

Inflow 55.3 1.2 13.5 40.6 –

(Outflow) (48.2) (0.8) (11.8) (35.6) –

Forward foreign exchange contracts 1.0

Inflow 47.4 27. 1 14.9 5.4 –

(Outflow) (46.8) (26.9) (14.6) (5.3) –

24 September 2021

Carrying

amount

£m

Contractual

amount

£m

Period

1-6 months

£m

Period

6-12 months

£m

Period

1-5 years

£m

Period

> 5 years

£m

Non-derivative financial instruments

Bank overdrafts (45.5) (45.5) (45.5) – – –

Bank borrowings (150.1) (163.1) (2.7) (2.8) (157.6) –

Private Placement Notes (106.6) (115.5) (49.3) (1.3) (64.9) –

Lease liabilities (59.6) (62.4) (8.9) (7.8) (33.8) (11.9)

Trade and other payables (370.9) (370.9) (367.2) – (3.7) –

Derivative financial instruments

Interest rate swaps – cash flow hedges (0.6)

Inflow/(outflow) (0.1) (0.6) – 0.5 –

Cross-currency interest rate swaps – cash flow hedges (4.7)

Inflow 96.1 50.0 1.0 45.1 –

(Outflow) (100.7) (51.9) (0.8) (48.0) –

Forward foreign exchange contracts (0.3)

Inflow 32.2 19.6 12.6 – –

(Outflow) (32.6) (19.9) (12.7) – –

163Strategic Report | Directors’ Report | Financial Statements

Credit risk

Credit risk refers to the risk of financial loss to the Group if a counterparty defaults on its contractual obligations on financial assets held on the

Statement of Financial Position. Risk is monitored both centrally and locally.

The Group derives a significant proportion of its revenue from sales to a limited number of major customers. Sales to individual customers can

be of significant value and the failure of any such customer to honour its debts could materially impact the Group’s results. The Group derives

significant benefit from trading with its large customers and manages the risk by regularly reviewing the credit history and rating of all

significant customers and reviewing outstanding balances for indicators of impairment. There have been no significant changes to the Group’s

credit risk parameters or to the composition of the Group’s trade receivables during the financial year.

The Group also manages credit risk in the UK through the use of a receivables purchase arrangement. Under the terms of this agreement the

Group has transferred substantially all of the credit risk and control of the receivables, which are subject to this agreement, and accordingly,

£54.0m (2021: £45.5m) has been derecognised at year end. The impact on the Group’s Statement of Cash Flows is recognised in working

capital movements within operating activities.

In addition, the Group operates trade receivable factoring arrangements with two of its larger customers. These arrangements allow the

Group to choose to factor the receivable before the sales are contractually due from the customer. These are non-recourse arrangements

and therefore amounts are de-recognised from trade receivables. At 30 September 2022 £39.9m (2021: £33.2m) was drawn under these

factoring facilities. The Group presents the factoring arrangements as part of the movement in working capital in the Group Statement of

Cash Flows.

The aged analysis of trade receivables for the year ended 30 September 2022 and 24 September 2021 is summarised in the table below.

2022

£m

2021

£m

Receivable within 1 months of the balance sheet date 172.2 140.1

Receivable between 1 and 3 months of the balance sheet date 5.5 5.2

Receivable greater than 3 months of the balance sheet date 1.8 0.3

Total trade receivables 179.5 145.6

Trade receivables are in general receivable within 90 days of the invoice date, are unsecured and are not interest bearing. The figures disclosed

above are stated net of allowances for impairment.

The Group applies the simplified approach to providing for expected credit losses (‘ECL’) permitted by IFRS 9 Financial Instruments, which

requires expected lifetime losses to be recognised from initial recognition of the trade receivables. The Group uses an allowance matrix to

measure the ECLs of trade receivables based on its credit loss rates. Expected loss rates are based on historical payment profiles of sales and

the corresponding historical credit loss experience. The historical loss rates are adjusted to reflect current and forward economic factors if

there is evidence to suggest these factors will affect the ability of the customer to settle receivables. The Group has determined the ECL

default rate using market default risk probabilities with regard to its key customers.

The movements in the provision for impairment of trade receivables are as follows:

2022

£m

2021

£m

At the beginning of the year (2.3) (2.1)

Provided during year (1.2) (0.6)

Written off during the year 0.1 0.4

At end of year (3.4) (2.3)

The Group has calculated ECL on other receivables balances using market default risk probabilities for key customers and has assessed that a

provision would be immaterial and therefore has not been provided for at 30 September 2022 (2021: £Nil).

Cash and cash equivalents and bank overdrafts

Exposure to credit risk on cash and derivative financial instruments is actively monitored by the Group’s treasury department. Risk of

counterparty default arising on cash and cash equivalents and bank overdrafts is controlled by dealing with high quality institutions and by

policy, limiting the amount of credit exposure to any one bank or institution. The Group transacts with a variety of high credit quality financial

institutions for the purpose of placing deposit. The Group actively monitors its credit exposure to each counterparty to ensure compliance

with the counterparty risk limits of the Board approved treasury policy.

Of the total cash and cash equivalents and bank overdrafts at 30 September 2022 and 24 September 2021, the cash was predominantly held

by financial institutions with minimum short term ratings of A-2 (Standard and Poor’s) or P-2 (Moody’s). The Group accordingly does not

expect any loss in relation to its cash and cash equivalents and bank overdrafts at 30 September 2022 (2021: £Nil).

164 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

22. Financial risk management and financial instruments continued

Price risk

The Group purchases a variety of commodities which can be subject to significant price volatility. The price risk on these commodities is

managed by the Group’s purchasing function by closely monitoring markets. The Group’s policy is to minimise its exposure to volatility by

adopting an appropriate forward purchase strategy by providing forward price forecasts to the business. This forecast enables the Group to

manage inflation.

Reconciliation of movements of liabilities to cash flows arising from financing activities

The reconciliation from opening to closing for the year ended 30 September 2022 is as follows:

24 September

2021

£m

Financing

cash flows

£m

Foreign

currency

translation

£m

Other and

non-cash

movements

£m

Other

operating cash

movements

£m

30 September

2022

£m

Bank borrowings (150.1) (9.6) – 0.9 – (158.8)

Private Placement Notes (106.6) 47. 3 (8.9) 0.3 – (67.9)

Lease liabilities (59.6) 17.3 – (6.9) 1.2 (48.0)

Total changes in liabilities arising from financing activities (316.3) 55.0 (8.9) (5.7) 1.2 (274.7)

Issue of Share Capital decreased by £0.1m in the year due to the share buyback during the year. £8.8m of the cash outflow has been

recognised within retained earnings. In the year £3.0m of own shares were purchased and put into trust. These have been recognised within

the own share reserve.

The reconciliation of opening to closing for the prior year ended 24 September 2021 is as follows:

25 September

2020

£m

Financing

cash flows

£m

Foreign

currency

translation

£m

Other and

non-cash

movements

£m

Other

operating cash

movements

£m

24 September

2021

£m

Bank borrowings (283.5) 130.9 – 2.5 – (150.1)

Private Placement Notes (114.0) – 6.4 1.0 – (106.6)

Lease liabilities (60.7) 14.3 – (14.5) 1.3 (59.6)

Total changes in liabilities arising from financing activities (458.2) 145.2 6.4 (11.0) 1.3 (316.3)

Issue of Share Capital * (4.9) (90.1) – – – (95.0)

Total changes in equity arising from financing activities (4.9) (90.1) – – – (95.0)

* £3m of fees have been recognised within retained earnings

Capital management

The Group manages its capital to ensure that entities in the Group will be able to trade on a going concern basis while maximising the return

to stakeholders through the optimisation of the debt and equity balance. The change in debt capital structure in the year is set out in the

Alternative Performance Measures and the change in equity is set out in Note 25. Invested capital is defined as the sum of all current and

non-current assets (including intangibles), less current and non-current liabilities with the exception of debt items, derivatives and retirement

benefit obligations (net of tax). The invested capital of the Group at 30 September 2022 is £689.2m (2021: £700.8m). The Group monitors the

return on invested capital of the Group as a key performance indicator; the calculation is set out in the Alternative Performance Measures on

page 183.

23. Provisions

Leases

£m

Remediation

and closure

£m

Reorganisation

£m

Other

£m

Total

£m

Year ended 30 September 2022

At 24 September 2021 4.6 1.8 – 1.2 7.6

Provided in year 0.2 – 7.6 0.3 8.1

Utilised in year (0.1) (0.4) (5.1) – (5.6)

Released in year – – – (0.3) (0.3)

Unwind of discount to present value in the year 0.1 – – – 0.1

At 30 September 2022 4.8 1.4 2.5 1.2 9.9

Analysed as:

2022

£m

2021

£m

Non-current liabilities 5.2 5.5

Current liabilities 4.7 2.1

9.9 7.6

165Strategic Report | Directors’ Report | Financial Statements

Leases

Lease provisions consist of provisions for leasehold dilapidations in respect of certain leases, relating to the estimated cost of reinstating

leasehold premises to their original condition at the time of the inception of the lease as provided for in the lease agreement. It is anticipated

that these will be payable within ten years.

Remediation and closure

Remediation and closure obligations were established to cover either a statutory, contractual or constructive obligation of the Group.

The majority of the obligation will unwind in one to three years.

Reorganisation

Reorganisation provisions consist of provisions for personnel exit costs arising from the Group’s Better Greencore programme. The provision

is expected to unwind within one year.

Other

Other provisions consist of potential litigation and warranty claims. It is anticipated that these provision will unwind in one to five years.

24. Retirement benefit obligations

The Group operates defined contribution pension schemes in all of its main operating locations. The Group also has legacy defined benefit

pension schemes, which were closed to future accrual on 31 December 2009.

Defined contribution pension schemes

The total cost charged to income of £14.1m (2021: £12.8m) represents employer contributions payable to the defined contribution pension

schemes at rates specified in the rules of the schemes. At year end, £2.2m (2021: £1.7m) was included in other accruals in respect of defined

contribution pension accruals.

Legacy defined benefit pension schemes

The Group operates one legacy defined benefit pension scheme and one legacy defined benefit commitment in Ireland (the ‘Irish schemes’)

and one legacy defined benefit pension scheme and one legacy defined benefit commitment in the UK (the ‘UK schemes’). The Projected Unit

Credit actuarial cost method has been employed in determining the present value of the defined benefit pension obligation, the related

current service cost and, where applicable, past service cost.

All of the legacy defined benefit pension schemes are closed to future accrual and there is an assumption applied in the valuation of the

schemes that there will be no discretionary increases in pension payments. Scheme assets are held in separate trustee administered funds.

These plans have broadly similar regulatory frameworks. Responsibility for governance of the plans, including investment decisions and

contribution schedules, lies with the Company and the respective boards of Trustees.

The Group’s cash contributions to its pension schemes are generally determined by reference to actuarial valuations undertaken by the

schemes’ actuaries at intervals not exceeding three years and not by the provisions of IAS 19 Employee Benefits. These funding valuations can

differ materially from the requirements of IAS 19. In particular the discount rate used to determine the value of liabilities under IAS 19 Employee

Benefits is determined by reference to the yield at the year end date on high grade corporate bonds of comparable duration to the liabilities.

In contrast the discount rate used in the ongoing valuation is generally determined by reference to the yield on the scheme’s current and

projected future investment portfolio.

Where a funding valuation reveals a deficit in a scheme, the Group will generally agree a schedule of contributions with the Trustees designed

to address the deficit over an agreed future time horizon. Full actuarial valuations were carried out between 31 March 2019 and 31 March

2020. In general, acturial valuations are not available for public inspection, however, the results of valuations are advised to members of the

various schemes. All of the schemes are operating under the terms of current funding proposals agreed with the relevant pension authorities.

Based on current discussions with the Trustees of the scheme cash contributions are expected to be modestly below £15m in FY23.

166 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

24. Retirement benefit obligations continued

Legacy defined benefit assets and liabilities

2022 2021

UK schemes

£m

Irish schemes

£m

Total

£m

UK schemes

£m

Irish schemes

£m

Total

£m

Fair value of plan assets 168.7 170.3 339.0 260.6 220.7 481.3

Present value of scheme liabilities (228.0) (131.3) (359.3) (347.7) (179.6) (527.3)

(Deficit)/surplus in schemes (59.3) 39.0 (20.3) (87.1) 41.1 (46.0)

Deferred tax asset (Note 9) 14.8 (4.9) 9.9 21.8 (5.1) 16.7

Net (liability)/asset at end of year (44.5) 34.1 (10.4) (65.3) 36.0 (29.3)

Presented as:

Retirement benefit asset* 39.8 42.1

Retirement benefit obligation (60.1) (88.1)

* The value of a net pension benefit asset is the value of any amount the Group reasonably expects to recover by way of refund of surplus from the remaining assets of a

plan at the end of the plan’s life.

The International Financial Reporting Standards Interpretations Committee (‘IFRIC 14’) clarifies how the asset ceiling should be applied,

particularly how it interacts with local minimum funding rules. The Group has determined that it has an unconditional right to a refund of

surplus assets if the schemes are run off until the last member dies.

Movement in the fair value of plan assets

2022

£m

2021

£m

Change in plan assets

Fair value of plan assets at beginning of year 481.3 502.8

Interest income on plan assets 7.3 6.3

Actuarial (loss)/gain (141.9) 31.1

Administrative expenses paid from plan assets (1.3) (1.0)

Employer contributions 12.6 8.0

Benefit payments (22.3) (26.7)

Settlement payments from plan assets – (23.4)

Effect of exchange rate changes 3.3 (15.8)

Fair value of plan assets at end of year 339.0 481.3

Movement in the present value of scheme liabilities

2022

£m

2021

£m

Change in present value of scheme liabilities

Present value of scheme liabilities at beginning of year 527.3 584.9

Interest expense 8.4 8.0

Past service cost – 0.2

Actuarial (gain)/loss on financial assumptions (177.8) 11.1

Actuarial loss/(gain) on experience 21.5 (0.7)

Actuarial loss/(gain) on demographic assumptions – (15.6)

Loss on settlements – 2.8

Plan settlements from plan assets – (23.4)

Administration costs included in Defined Benefit Obligation for schemes in wind up (0.2) –

Benefit payments (22.3) (26.7)

Effect of exchange rate changes 2.4 (13.3)

Present value of scheme liabilities at end of year 359.3 527.3

Risks and assumptions

The legacy defined employee benefit plans expose the Group to a number of risks, the most significant of which are:

Asset volatility: The plan liabilities are calculated using a discount rate set with reference to corporate bond yields. If assets underperform this

yield this will create a deficit. The plans hold equities which, though expected to outperform corporate bonds in the long term, create volatility

and risk in the short term. The allocation to equities is monitored to ensure that it remains appropriate given the plans’ long term objectives.

167Strategic Report | Directors’ Report | Financial Statements

Discount rates: The discount rates employed in determining the present value of the schemes’ liabilities are determined by reference to

market yields at the year end date on high-quality corporate bonds of a currency and term consistent with the currency and term of the

associated post-employment benefit obligations. Changes in discount rates impact the quantum of the liabilities.

Inflation risk: Some of the Group’s pension obligations are linked to inflation; higher inflation will lead to higher liabilities (although in most

cases, caps on the level of inflationary increases are in place to protect the plan against extreme inflation). The rate of inflation is derived

from the relative yields of index-linked and fixed interest government bonds priced as of 30 September 2022 in the UK. The Irish inflation

assumption has been set based on market expectations at the reporting date which included consideration of the yield on long term Irish

Government bonds.

Longevity risk: In the majority of cases, the Group’s legacy defined benefit pension schemes provide benefits for the life of the member,

so increases in life expectancy will therefore give rise to higher liabilities.

Climate change: The impact of climate change on mortality rates, particularly future mortality rates, has been considered and it has been

concluded that there is no impact in the current year. This will continue to be kept under review.

The size of the obligation is sensitive to judgemental actuarial assumptions. These include demographic assumptions covering mortality,

economic assumptions covering price inflation and benefit increases, together with the discount rate.

The principal actuarial assumptions are as follows:

UK schemes Irish schemes

2022 2021 2022 2021

Rate of increase in pension payments* 3.35% 3.35% 0.00% 0.00%

Discount rate 5.00% 1.90% 4.00% 1.13%

Inflation rate** 3.55% 3.45% 2.40% 1.80%

* The rate of increase in pension payments applies to the majority of the liability base, however there are certain categories within the Group’s Irish schemes that have an

entitlement to pension indexation.

** The assumption for RPI and CPI are derived from the relative yields of index-linked and fixed interest government bonds.

Assumptions regarding future mortality experience are set based on information from published statistics and experience in all geographic

regions and are selected to reflect the characteristics and experience of the membership of the relevant plans. In relation to the UK, this has

been done by reflecting the characteristics of the membership using the demographic tables from S3PMA with CMI 2019 model for future

improvements in mortality. The average life expectancy, in years, of a pensioner retiring at 65 is as follows:

UK schemes Irish schemes

2022

years

2021

years

2022

years

2021

years

Male 22 22 23 22

Female 24 24 24 24

Sensitivity of pension liability to actuarial assumptions

Impact on scheme liabilities

Assumption Change in assumption

schemes

£m

Irish

schemes

£m

Total

2022

£m

Total

2021

£m

Discount rate Decrease by 0.5% 16.3 6.2 22.5 46.2

Discount rate Increase by 0.5% (14.6) (5.7) (20.3) (41.0)

Rate of inflation Decrease by 0.5% (14.7) (1.8) (16.5) (28.2)

Rate of inflation Increase by 0.5% 13.8 2.0 15.8 28.5

Rate of mortality Members assumed to live 1 year longer 5.8 5.1 10.9 18.8

Sensitivity of pension scheme assets to yield movements

Impact on scheme assets

Assumption Change in assumption

schemes

£m

Irish

schemes

£m

Total

2022

£m

Total

2021

£m

Change in bond yields Decrease by 0.5% 15.0 6.5 21.5 39.9

The above sensitivity analyses are based on a change in an assumption while holding all other assumptions constant. The sensitivity analysis

intends to provide assistance in understanding the sensitivity of the valuation of pension liabilities to market movements on discount rates,

inflation rates and mortality assumptions for scheme beneficiaries.

168 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

24. Retirement benefit obligations continued

Hedging strategy

The Trustees invest the funds in a range of assets with the objective of maximising the fund return with a view to containing the cost of

funding the scheme whilst at the same time maintaining an acceptable risk profile. In assessing the risk profile the Trustees take account

of the nature and duration of the liabilities.

Plan assets are comprised as follows:

2022 2021

Quoted

£m

Unquoted

£m

Total

£m

Quoted

£m

Unquoted

£m

Total

£m

Cash 78.5 – 78.5 28.8 – 28.8

Debt instruments 101.1 – 101.1 129.2 – 129.2

Real estate – – – 22.2 – 22.2

Derivatives 125.0 – 125.0 214.6 – 214.6

Investment funds* 16.0 18.4 34.4 86.5 – 86.5

Fair value of plan assets 320.6 18.4 339.0 481.3 – 481.3

* A quoted market price in an active market is not available.

The primary Irish and UK Schemes have Liability Driven Investment (‘LDI’) for 67% (2021: 73%) of the Irish funds and 50% (2021: 60%) of the

UK funds which aims to hedge 100% (relative to assets) of the interest rate and inflation risk in the schemes. The hedging strategy is designed

to reduce the schemes’ exposure to changes in interest rates and inflation expectations, therefore, reducing funding level risk and volatility.

The Trustees review investment strategy regularly. In the final quarter of the financial year, due to economic volatility in the UK, particularly

in bond markets, this led to a larger than normal spread between movements in the scheme assets and liabilities in a number of pension

schemes. For the Group UK schemes, due to the current hedging strategy in place, there was no deterioration in the funding position of the

schemes as a result of these changes, and the Group did not have to provide any additional funding or collateral to maintain the hedged

position of the scheme.

The hedging on the Irish Schemes is provided via a mix of interest rate and inflation swaps and a buy and hold credit portfolio. The interest rate

and inflation swaps held are an exchange of cash flows where the initial market value of the bond portfolio on one side of the swap equals the

present value of the pre-defined payments on the other side of the swap. A limited amount of leverage is used to enable a greater reduction

in liability risk. The hedging on the UK Schemes is provided via pooled fund manager funds which have specified limits on leverage.

Maturity analysis

The expected maturity analysis is set out in the table below:

UK schemes

% of benefits

Irish schemes

% of benefits

Total

% of benefits

Expected benefit payments:

Within 5 years 10% 26% 16%

Between 6 and 10 years 12% 22% 16%

Between 11 and 15 years 14% 17% 15%

Between 16 and 20 years 14% 13% 13%

Between 21 and 25 years 13% 8% 11%

Over 25 years 37% 14% 29%

The weighted average duration of the UK and Irish legacy defined benefit obligations are 18 years (2021: 19 years) and 11 years (2021: 12 years)

respectively.

Greencore Group Pension Scheme contingent asset

The primary scheme in Ireland, Greencore Group Pension Scheme (‘the Scheme’) has a mortgage and charge relating to certain property

assets of the Group with a carrying value of £3.1m (2021: £3.0m) for use as a contingent asset of the Scheme. Under the terms of the

mortgage and charge, should a disposal of these property assets occur that meets certain requirements, the Scheme is entitled to a portion of

the sale proceeds. The maximum amount recoverable by the Trustees of the Scheme under the mortgage and charge is the amount required

for the Scheme to meet the minimum funding standard under the Pension Acts 1990-2009.

Pension funding partnership

In 2013, the Group entered into arrangements with the Greencore UK Legacy Defined Benefit Scheme (‘the UK Scheme’) to address £40.0m

of the actuarial deficit in the UK Scheme. The substance of this arrangement is to reduce the cash funding which would otherwise be required

based on the latest actuarial valuation, whilst improving the security of the UK Scheme members’ benefits.

169Strategic Report | Directors’ Report | Financial Statements

On 10 May 2013, the Group made a contribution to the UK Scheme of £32.8m. On the same day, the UK Scheme’s Trustees invested £32.8m

in Greencore Convenience Foods Limited Partnership (‘SLP’) as a limited partner. SLP was established by Greencore Prepared Meals Limited,

a wholly owned subsidiary of the Group, to hold properties of the Group and loan notes issued by Greencore Convenience Foods I Limited

Liability Partnership (‘LLP’). LLP was established by SLP and holds certain trade receivables of the Group. As at 30 September 2022, SLP held

properties with a carrying value of £15.2m (2021: £15.6m) and trade receivables with a carrying value of £36.0m (2021: £36.0m) in the Group

Financial Statements. The properties are leased to other Group undertakings. As a partner in SLP, the UK Scheme is entitled to a semi-annual

share of the profits of SLP until 2029.

These partnerships are controlled by the Group, and as such, they are fully consolidated as wholly owned subsidiaries in accordance with IFRS

10 Consolidated Financial Statements. Under IAS 19 Employee Benefits, the investment held by the Scheme in SLP, does not represent a plan

asset for the purposes of the Group’s consolidated accounts. Accordingly, the Scheme’s deficit position presented in the Group Financial

Statements does not reflect the investment in SLP held by the UK Scheme. Distributions from SLP to the UK Scheme are treated as

contributions by employers in the Group Financial Statements on a cash basis.

25. Share capital

Authorised

2022

£m

2021

£m

1,000,000,000 Ordinary Shares of £0.01 each 10.0 10.0

500,000,000 Deferred Shares of €0.01 each 4.3 4.3

300,000,000 Deferred Shares of €0.62 each 160.1 160.1

1 Special Rights Preference Share of €1.26

(A)

– –

174.4 174.4

Issued and fully paid

2022

£m

2021

£m

516,836,560 (2021: 526,546,662) Ordinary Shares of £0.01 each 5.2 5.3

1 Special Rights Preference Share of €1.26

(A)

– –

5.2 5.3

Reconciliation of movements on Equity Share Capital

2022

£’000

2021

£’000

Share capital, at beginning of year 5,255 4,451

Exercise of share options

(B)

– –

Share buyback and cancellation of shares

(C)

(97) –

Shares issued in equity raise

(D)

– 804

5,158 5,255

(A) There is one Special Share of €1.26 in the capital of the Company. The Articles of Association provide that the Special Share may be held only by, or transferred only to,

the Minister for Agriculture, Food and the Marine or some other person appointed by the Minister. In 2011, many of the rights attaching to the Special Share were

abolished.

(B) 18,575 share options (2021: 32,264) granted under the ShareSave scheme were exercised in the year at a nominal value of £0.0002m (2021:£0.0003m). See Note 6.

(C) 9,728,677 Ordinary shares in the Company were repurchased in the current year and immediately cancelled (2021: Nil). The shares of nominal value £0.097m (2021: £Nil)

were purchased for £8.8m.

(D) In the prior year, the Group raised £90.0m by way of an equity placing. The Group issued 80,357,142 Ordinary Shares in the Company on the London Stock Exchange,

at a placing price of 112 pence per Ordinary Share.

All shares, with the exception of the Special Rights Preference Share, carry equal voting rights and rank for dividends to the extent to which the

total amount payable in each share is paid up.

Prior consent of the holder of the Special Share is required in the event that there is a proposal for the voluntary winding up or dissolution

of the Company or if there is any proposed sale, transfer or disposal of the Company’s subsidiary, Irish Sugar Designated Activity Company.

The holder of the Special Share is only entitled to a repayment of the capital paid up on the Special Share (€1.26) and has no further right to

participate in the profits of the Company or any entitlement to dividend.

Own share reserve:

Number of shares Nominal value of share Total own share reserve

2022

number

2021

number

2022

£m

2021

£m

2022

£m

2021

£m

At beginning of year 986,837 1,675,688 0.010 0.017 1.8 2.9

Shares acquired by Employee Benefit Trust 2,180,216 – 0.022 – 3.0 –

Transferred to beneficiaries of the share scheme (290,044) (688,851) (0.003) (0.007) (0.4) (1.1)

At end of year 2,877,009 986,837 0.029 0.010 4.4 1.8

At 30 September 2022, 0.6% of share capital is held in this reserve (24 September 2021: 0.2%)

170 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

26. Working capital movement

The following represents the Group’s working capital movement:

2022

£m

2021

£m

Increase in inventories (15.6) (5.3)

Increase in trade and other receivables (52.6) (39.9)

Increase in trade and other payables 70.2 78.4

2.0 33.2

27. Capital expenditure commitments

The table below includes the capital commitments for the Group as at year ended 30 September 2022:

2022

£m

2021

£m

Capital expenditure that has been contracted but not been provided for 8.7 6.6

Capital expenditure that has been authorised by the Directors but not yet contracted 10.5 30.4

19.2 37.0

28. Disposal of undertakings and non-controlling interests

Molasses trading businesses

In the prior year, the Group completed the sale of its interest in its molasses trading businesses to United Molasses Marketing (Ireland) Limited

and United Molasses Marketing Limited.

Effect of disposal on the financial statements

2022

£m

2021

£m

Total assets and liabilities disposed of – (13.1)

Disposal consideration

Purchase consideration – 15.5

Working capital settlement – 2.7

Total net consideration – 18.2

Disposal related costs – (0.6)

Translation reserve transferred to Income Statement on disposal of subsidiary – 1.0

Non-controlling interest transferred to Income Statement on disposal of subsidiary – 5.8

Profit on disposal – 11.3

Reconciliation of consideration to cash received

2022

£m

2021

£m

Purchase consideration – 15.5

Cash received in respect of working capital settlement – 2.7

Transaction costs paid – (0.4)

Net consideration received on completion – 17.8

Cash and cash equivalents disposed of – (1.5)

Net cash inflow arising on disposal – 16.3

Non controlling interests reconciliation

2022

£m

2021

£m

At beginning of year – 5.7

Profit after tax – 0.3

Dividends paid to non-controlling interests – –

Currency translation adjustment – (0.2)

Non-controlling interest transferred to Income Statement on disposal of subsidiary – (5.8)

At end of year – –

171Strategic Report | Directors’ Report | Financial Statements

29. Contingencies

The Company and certain subsidiaries have given guarantees in respect of borrowings and other obligations arising in the ordinary course

of business of the Company and other Group undertakings. The Company and other Group undertakings consider these guarantees to be

insurance contracts and account for them as such. The Company treats these guarantee contracts as contingent liabilities until such time as

it becomes probable that a payment will be required under such guarantees.

Pursuant to the provisions of Section 357, Companies Act 2014, the Company has guaranteed the liabilities of certain subsidiary undertakings

in Ireland for the financial year ended 30 September 2022 and as a result, such subsidiary undertakings have been exempted from the filing

provisions of Companies Act 2014. See Note 31 for the list of these subsidiary entities.

The Group has provided bank guarantees to third party insurers for an amount of £4.6m (2021: £5.8m).

30. Related party disclosures

The principal related party relationships requiring disclosure in the Group Financial Statements under IAS 24 Related Party Disclosures pertain

to the existence of subsidiaries and transactions with these entities entered into by the Group, as well as the identification and compensation

of key management personnel, as addressed in greater detail below.

Subsidiaries

The Group Financial Statements include the Financial Statements of the Company (Greencore Group plc, the ultimate parent) and its

subsidiaries. A listing of the principal subsidiaries is provided in Note 31 of the Group Financial Statements.

Sales to and purchases from, together with outstanding payables and receivables to and from, subsidiaries, are eliminated in the preparation

of the Group Financial Statements in accordance with IFRS 10 Consolidated Financial Statements.

Key management personnel

For the purposes of the disclosure requirements of IAS 24 Related Party Disclosures, the term ‘Key Management Personnel’ (i.e. those persons

having the authority and responsibility for planning, directing and controlling the activities of the Company), comprise the Board of Directors

which manages the business and affairs of the Group.

Key management personnel compensation was as follows:

2022

£m

2021

£m

Salaries and other short-term employee benefits 1.9 2.1

Post-employment benefits – defined contribution costs 0.1 0.2

Share-based payments* – 0.4

2.0 2.7

* This is the Income Statement charge for the year which represents the fair value of the share-based payments, relating to Executive Directors. Details of the Group’s

share-based payments and the basis of calculation are set out in Note 6. This differs from the amount included in the single total figure for remuneration included in the

Directors’ Report which is not an IFRS metric.

31. Principal subsidiary undertakings

Name of undertaking Nature of business Percentage share Registered office

Greencore Advances Designated Activity Company

(A)(C)

Finance company 100 No. 2 Northwood Avenue

Northwood Business Park, Santry

Dublin 9, D09 X5N9

Greencore Beechwood Limited

(A)(D)

Holding company 100 Greencore Manton Wood

Retford Road

Manton Wood Enterprise Park

Worksop S80 2RS

Greencore Convenience Foods Limited Partnership

(B)(D)

Pension funding 100 c/o Eversheds LLP

3-5 Melville Street

Edinburgh EH3 7PE

Greencore Convenience Foods I Limited Liability

Partnership

(B)(D)

Pension funding 100 Greencore Manton Wood

Retford Road

Manton Wood Enterprise Park

Worksop S80 2RS

Greencore Developments Designated Activity

Company

(A)(C)

Property company 100 No. 2 Northwood Avenue

Northwood Business Park, Santry

Dublin 9, D09 X5N9

172 Greencore Group plc Annual Report and Financial Statements 2022

Notes to the Group Financial Statements continued

year ended 30 September 2022

Name of undertaking Nature of business Percentage share Registered office

Greencore Finance Designated Activity Company

(A)(C)

Finance company 100 No. 2 Northwood Avenue

Northwood Business Park, Santry

Dublin 9, D09 X5N9

Greencore Foods Limited

(A)(D)

Holding and management

services company

100 Greencore Manton Wood

Retford Road

Manton Wood Enterprise Park

Worksop S80 2RS

Greencore Food to Go Limited

(A)(D)

Food manufacturer 100 Greencore Manton Wood

Retford Road

Manton Wood Enterprise Park

Worksop S80 2RS

Greencore Funding Limited

(A)(E)

Finance company 100 13 Castle Street

St. Helier

Jersey JE4 5UT

Greencore Grocery Limited

(A)(D)

Food manufacturer 100 Greencore Manton Wood

Retford Road

Manton Wood Enterprise Park

Worksop S80 2RS

Greencore Prepared Meals Limited

(A)(D)

Food manufacturer 100 Greencore Manton Wood

Retford Road

Manton Wood Enterprise Park

Worksop S80 2RS

Greencore UK Holdings Limited

(A)(D)

Holding company 100 Greencore Manton Wood

Retford Road

Manton Wood Enterprise Park

Worksop S80 2RS

Hazlewood Foods Limited

(A)(D)

Holding company 100 Greencore Manton Wood

Retford Road

Manton Wood Enterprise Park

Worksop S80 2RS

Irish Sugar Designated Activity Company

(A)(C)

General trading company 100 No. 2 Northwood Avenue

Northwood Business Park, Santry

Dublin 9, D09 X5N9

Trilby Trading Limited

(A)(C)

Food industry supplier 100 No. 2 Northwood Avenue

Northwood Business Park, Santry

Dublin 9, D09 X5N9

(A) These companies are all ultimately held 100% by Greencore Group PLC. Each of the shares held are Ordinary shares.

(B) These companies are partnerships and the interests held represents interests in member capital

(C) These companies are registered in Ireland and are availing of the exemption as set out in s.357 of the Companies Act 2014

(D) These companies are registered in the UK

(E) This company is registered in Jersey

32. Subsequent events

Pension plan asset

In November 2022, the Trustees of the Irish legacy defined benefit pension scheme entered into an annuity buy-in transaction to purchase an

insurance policy for the pensioner liabilities, representing approximately 80% of the liabilities in the scheme. The insurance policy will be

treated as a plan asset and the fair value of the policy is deemed to be the present value of the related obligations.

Recommencement of share buyback

The Group will recommence a return of value to investors by way of the share buyback programme which is expected to return a futher £15m

to shareholders in FY23.

33. Board approval

The Group Financial Statements, together with the Company Financial Statements, for the year ended 30 September 2022 were approved by

the Board of Directors and authorised for issue on 28 November 2022.

31. Principal subsidiary undertakings continued

173Strategic Report | Directors’ Report | Financial Statements

Company Statement of Financial Position

at 30 September 2022

Notes

2022

£m

2021

£m

ASSETS

Non-current assets

Intangible assets 0.4 0.7

Property, plant and equipment 0.3 0.4

Right-of-use assets 0.4 0.6

Financial assets 2 766.6 766.6

Total non-current assets 767.7 768.3

Current assets

Trade and other receivables 3 3.6 7.0

Cash and cash equivalents 0.1 –

Total current assets 3.7 7.0

Total assets 771.4 775.3

EQUITY

Capital and reserves

Share capital 6 5.2 5.3

Share premium 89.7 89.7

Undenominated capital reserve 120.5 120.4

Other reserves (0.6) 1.8

Retained Earnings 149.3 160.5

Total equity 364.1 377.7

LIABILITIES

Non-current liabilities

Lease liabilities 0.2 0.5

Provisions 5 0.6 1.1

Total non-current liabilities 0.8 1.6

Current liabilities

Bank overdraft 5.8 –

Lease liabilities 0.3 0.3

Trade and Other payables 4 399.8 395.6

Provisions 5 0.6 0.1

Total current liabilities 406.5 396.0

Total liabilities 407.3 397.6

Total equity and liabilities 771.4 775.3

The Company only loss for the year was £4.8m (2021: loss of £25.3m)

On behalf of the Board

Gary Kennedy Emma Hynes

Director Director

174 Greencore Group plc Annual Report and Financial Statements 2022

capital

£m

premium

£m

Undenominated

capital reserve

(D)

£m

Share-

based

payment

reserve

(E)

£m

Own share

reserve

(F)

£m

Retained

earnings

£m

Total equity

£m

At 24 September 2021 5.3 89.7 120.4 3.6 (1.8) 160.5 377.7

Items of income and expense taken directly to equity

Loss for the financial year – – – – – (4.8) (4.8)

Total comprehensive income for the year – – – – – (4.8) (4.8)

Transactions with equity holders of the Company

Employee share-based payment expense – – – 3.0 – – 3.0

Exercise, forfeit or lapse of share based payments – – – (2.8) – 2.8 –

Shares acquired by Employee Benefit Trust

(A)

– – – – (3.0) – (3.0)

Transfer to retained earnings on grant of shares to

beneficiaries of the Employee Benefit Trust

(B)

– – – – 0.4 (0.4) –

Capital return via share buyback

(C)

(0.1) – 0.1 – – (8.8) (8.8)

At 30 September 2022 5.2 89.7 120.5 3.8 (4.4) 149.3 364.1

capital

£m

premium

£m

Undenominated

capital reserve

(D)

£m

Share-

based

payment

reserve

(E)

£m

Own share

reserve

(F)

£m

Retained

earnings

£m

Total equity

£m

At 25 September 2020 4.5 0.4 120.4 3.9 (2.9) 187.5 313.8

Items of income and expense taken directly to equity

Loss for the financial year – – – – – (25.3) (25.3)

Total comprehensive income for the year – – – – – (25.3) (25.3)

Transactions with equity holders of the Company

Employee share-based payment expense – – – 2.1 – – 2.1

Exercise, forfeit or lapse of share based payments – 0.1 – (2.4) – 2.4 0.1

Transfer to retained earnings on grant of shares to

beneficiaries of the Employee Benefit Trust

(B)

– – – – 1.1 (1.1) –

Shares issued in the year 0.8 89.2 – – – – 90.0

Transaction costs of share issue – – – – – (3.0) (3.0)

At 24 September 2021 5.3 89.7 120.4 3.6 (1.8) 160.5 377.7

(A) Pursuant to the terms of the Employee Benefit Trust 2,180,216 shares (2021: Nil) were purchased during the financial year ended 30 September 2022 for a cash cost of

£3.0m (2021: £Nil).

(B) During the year, 290,044 (2021: 688,851) shares with a nominal value at the date of transfer of £0.0029m (2021: £0.0069m) at a cost of £0.4m (2021: £1.1m) were

transferred to beneficiaries of the Annual Bonus Plan.

(C) During the year, the Company purchased and subsequently cancelled 9,728,677 Ordinary Shares for a total cash cost of £8.8m as part of the share buyback programme.

(D) The undenominated capital reserve represents the nominal cost of cancelled shares and the amount transferred to reserves as a result of renominalising the share capital

of the Company on conversion to the euro.

(E) The share-based payment reserve relates to equity settled share-based payment made to employees through the Performance Share Plan, the Annual Bonus Plan, the

ShareSave Scheme and Employee Incentive Scheme. Further information in relation to these share-based payment schemes is set out in Note 6 of the Group Financial

Statements.

(F) The amount included as own shares relates to Ordinary Shares in the Company which are held in trust. The shares held in trust are granted to beneficiaries of the Group’s

employee share-based payment schemes when the relevant conditions of the scheme are satisfied.

Company Statement of Changes in Equity

year ended 30 September 2022

175Strategic Report | Directors’ Report | Financial Statements

Notes to the Company Financial Statements

year ended 30 September 2022

1. Company only Statement of accounting policies

Basis of preparation

The Company only Financial Statements of Greencore Group plc (‘the Company’) were prepared under the historical cost convention, in

accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (‘FRS 101’). In preparing these Financial Statements, the

Company applies the recognition, measurement and disclosure requirements of International Financial Reporting Standards as adopted by the

EU (‘Adopted IFRSs’) but makes amendments where necessary in order to comply with the Companies Acts 2014 and has set out below where

advantage of the FRS 101 disclosure exemptions has been taken.

In these financial statements, the company has applied the exemptions available under FRS 101 in respect of the following disclosures:

• A Cash Flow Statement and related notes;

• Disclosures in respect of transactions with wholly owned subsidiaries;

• Disclosures in respect of capital management;

• The effects of new but not yet effective IFRSs; and

• Disclosures in respect of the compensation of Key Management Personnel.

As the Consolidated Financial Statements of the Group are prepared in accordance with IFRS as adopted by the EU and include the equivalent

disclosures, the Company has also taken the exemptions under FRS 101 available in respect of the following disclosures:

• Certain disclosures required by IFRS 2 Share Based Payments;

• Certain disclosures required by IFRS 13 Fair Value Measurement and the disclosures required by IFRS 7 Financial Instruments: disclosures;

• Certain disclosures required by IFRS 16 Leases.

The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these financial

statements. The Company applies consistent accounting policies for measurement and recognition purposes under FRS 101 to those applied

by the Group. To the extent that an accounting policy is relevant to both Group and the Company financial statements, please refer to the

Group financial statements for disclosure of the relevant accounting policy.

The financial statements have been prepared in sterling and are rounded to the nearest million.

Going Concern

Notwithstanding the fact that the Company is in a net current liability position of £402.8m (FY21: £389.0m), the Directors, after making

enquiries and considering the scenario analysis that was performed as part of the Group’s going concern assessment, have a reasonable

expectation that the Company has adequate resources to continue operating as a going concern for the foreseeable future, being a period

of 18 months from the year end date. Accordingly, the financial statements of the Company are prepared on a going concern basis.

Significant accounting judgements

The Company considers the judgements made in determining whether there is an impairment in the investment in subsidiaries to be its

significant accounting judgement. The Company compares the carrying value of the investment with its recoverable amount. The recoverable

amount is the higher of the investment’s fair value less costs to sell and its value in use (‘VIU’). VIU is the present value of expected future cash

flows from the investment. The Company uses a discounted cash flow model to derive VIU.

The key inputs into the model are (i) cash flow forecasts; (ii) growth rates; and (iii) discount rates.

Cash flow forecasts

Cash flow forecasts employed for this calculation are based on the approved FY23 budget and two year strategic plan and specifically

excludes incremental profits and other cash flows stemming from any potential future acquisitions. The cash flow forecasts involved

judgements which were subject to review and validation at a number of levels of governance and are the current best estimate of the

expected cash flows over the forecast period.

Growth rates

Growth rates beyond three years are determined by reference to local economic growth rates. The assumed long term growth rate for the

purpose of the impairment assessment is 2% (2021: 2%).

Discount rate

The discount rate applied is based on the pre-tax weighted average cost of capital for the Group which is 11% at 30 September 2022

(24 September 2021: 10%).

Profit or loss

The loss attributable to equity shareholders dealt with in the Financial Statements of the Company was £4.8m (2021: loss of £25.3m).

In accordance with Section 304 of the Companies Act 2014, the Company is availing of the exemption from presenting its individual Income

Statement to the Annual General Meeting and from filing it with the Registrar of Companies.

176 Greencore Group plc Annual Report and Financial Statements 2022

1. Company only Statement of accounting policies continued

Financial assets

Investments in subsidiaries are held at cost less impairment. The Company assesses investments for impairment whenever events or changes

in circumstances indicate that the carrying value of an investment may not be recoverable. If any such indication of impairment exists, the

Company makes an estimate of its recoverable amount. When the carrying amount of an investment exceeds its recoverable amount, the

investment is considered impaired and is written down to its recoverable amount.

Trade and other receivables

Trade and other receivables, which primarily comprise intercompany receivables, are initially recognised at their transaction value and subsequently

carried at amortised cost, net of allowance for expected credit loss. The Company applies the simplified approach to providing for expected credit

losses (‘ECL’) permitted by IFRS 9 Financial Instruments, which requires expected lifetime losses to be recognised from initial recognition of the

receivables. The Company uses an allowance matrix to measure the ECL of receivables based on historic credit loss experience adjusted to reflect

current and forward economic factors if there is evidence to suggest these factors will affect the ability of the counterparty to settle receivables.

The company’s intercompany receivables at 30 September 2022 amounted to £1.2m (2021: £5.3m). There is no material ECL in respect of

intercompany receivables as at 30 September 2022 or 24 September 2021.

Trade and other payables

Trade and other payables are initially recorded at their fair value and subsequently carried at amortised cost.

Intra-Group guarantees

Where the Company enters into financial guarantee contracts to guarantee the indebtedness of other companies within its Group, the Company

considers these to be insurance arrangements and accounts for them as such. In this respect, the Company treats the guarantee contract as

a contingent liability until such time as it becomes probable that the Company will be required to make a payment under the guarantee.

2. Financial assets

Interest in

subsidiary

undertakings

£m

Total

£m

At 24 September 2021 766.6 766.6

At 30 September 2022 766.6 766.6

At reporting date, the recoverable value of investments in subsidiaries was assessed for impairment as the market capitalisation of the

Company was lower than the net assets and therefore as this is an indicator of impairment, an impairment assessment was performed in line

with the requirements of IAS 36 Impairment of Assets.

The recoverable amount of the investment has been determined based on a VIU calculation using cash flow projections from the Group’s

latest budget and forecasts, using a pre-tax rate of 11% and growth into perpetuity of 2% and discounted back to present values. There were

no impairments required in the year.

The principal holding subsidiaries of the Company are Greencore Holdings Designated Activity Company (100% ownership of which 74% is

held directly by the Company and 26% indirectly in ordinary shares) and Greencore Holdings (Ireland) Limited (100% ownership of ordinary

shares) which are all incorporated in Ireland.

3. Trade and other receivables

2022

£m

2021

£m

Amounts falling due within one year

Amounts owed by subsidiary undertakings * 1.2 5.3

Other debtors 1.9 1.5

Prepayments and accrued income 0.5 0.2

3.6 7.0

* Amounts due from subsidiary undertakings are repayable on demand.

Notes to the Company Financial Statements continued

year ended 30 September 2022

177Strategic Report | Directors’ Report | Financial Statements

4. Trade and other payables

2022

£m

2021

£m

Amounts falling due within one year

Amounts owed to subsidiary undertakings * 389.1 384.1

Trade and other creditors 3.3 4.4

Accruals 7.4 7.0

Bank overdraft – 0.1

399.8 395.6

* Amounts due to subsidiary undertakings are classified as current, as all inter-company receivables and payables are repayable on demand.

Bank overdrafts were included as part of trade and other payables in the prior year. In the current year, as the balance is more significant,

it has been presented separately on the Company Statement of Financial Position. The balance at 30 September 2022 is £5.8m (2021: £0.1m).

5. Provisions

Total

£m

At 24 September 2021 1.2

Provided in year 0.3

Released in year (0.3)

At 30 September 2022 1.2

Analysed as:

2022

£m

2021

£m

Non-current liabilities 0.6 1.1

Current liabilities 0.6 0.1

1.2 1.2

Provisions consist of potential litigation and warranty claims. It is anticipated that these provisions will unwind in one to five years.

6. Share capital

Details in respect of called-up share capital are presented in Note 25 of the Group Financial Statements.

7. Employee benefits

A subsidiary company, Irish Sugar DAC, operates a funded defined benefit pension scheme for its employees, including certain employees of

the Company. The scheme assets are held in separate Trustee administered funds. Contributions to these funds, which are charged against

profits, are based on independent actuarial advice following the most recent valuation of such funds.

The last completed full actuarial valuation was carried out at 31 March 2019 and there is another full actuarial valuation for 31 March 2022

ongoing, which has not yet been finalised. In general, actuarial valuations are not available for public inspection, however, the results of

valuations are advised to the members of the various schemes. This scheme had a net surplus at 30 September 2022 of £39.8m (2021:

£41.6m) as measured on a lAS 19 Employee Benefits basis. The contribution for the period was £Nil (2021: £Nil). At year end, £Nil (2021: £Nil)

was included in other accruals in respect of amounts owed to the scheme. The scheme was closed to future benefit accrual on 31 December

2009.

Disclosures in relation to this and all other Group legacy defined benefit pension schemes are given in Note 24 to the Group Financial Statements.

The Company also contributes to a defined contribution scheme for its employees. At year end, £Nil (2021: £Nil) was included in other

accruals in respect of amounts owed to the scheme.

178 Greencore Group plc Annual Report and Financial Statements 2022

7. Employee benefits continued

The average number of persons employed by the Company (including Executive Directors) was 23 (2021: 24) and the staff costs for the year

for those employees were:

2022

£m

2021

£m

Wages and salaries 3.9 3.9

Social insurance costs 0.3 0.3

Employee share-based payment expense 0.0 0.5

Pension costs – defined contribution plans 0.3 0.4

4.5 5.1

No employee costs were capitalised in the year (2021: £Nil)

8. Share based payments

The Company grants share awards and options under various share option plans as detailed in the Directors’ Report. A charge of £0.0m (2021:

£0.5m) was recognised in the Income Statement of the Company in respect of the employees of the Company. All disclosures relating to the

plans are given in Note 6 to the Group Financial Statements.

9. Guarantees and commitments

Pursuant to the provisions of Section 357, Companies Act 2014, the Company has guaranteed the liabilities and commitments of certain

subsidiary undertakings in Ireland for the financial year ended 30 September 2022. Where the Company has entered into financial guarantee

contracts to guarantee the indebtedness of such subsidiaries, the Company considers these to be insurance contracts and accounts for them

as such. See Note 31 for the list of these subsidiary entities.

The Company has provided bank guarantees to third party insurers for an amount of £4.6m (2021: £5.8m).

10. Statutory information

Directors’ remuneration is disclosed in the Report on Directors’ Remuneration and in Note 30 to the Group Financial Statements.

Auditor’s remuneration for services provided to the Company for the year was as follows:

2022

£’000

2021

£’000

Audit of the Company financial statements 42.0 35.0

Other assurance services 25.0 25.0

Audit related assurance services – –

Other assurance services provided for the audit of the Group and subsidiaries financial statements for the year was £797k (2021: £570k) as

disclosed in Note 4 to the Group Financial Statements.

Notes to the Company Financial Statements continued

year ended 30 September 2022

179Strategic Report | Directors’ Report | Financial Statements

Alternative Performance Measures

The Group uses the following Alternative Performance Measures (‘APMs’) which are non-IFRS measures to monitor the performance of its

operations and of the Group as a whole: Pro Forma Revenue Growth, Adjusted EBITDA, Adjusted Operating Profit, Adjusted Operating Margin,

Adjusted Profit before Tax (‘PBT’), Adjusted Earnings, Adjusted Earnings per Share, Maintenance and Strategic Capital Expenditure, Free Cash

Flow, Free Cash Flow Conversion, Net Debt, Net Debt excluding lease liabilities and Return on Invested Capital (‘ROIC’). There have been no

adjustments made to existing APMs being reported and no new APMs have been included in this report.

The Group believes that these APMs provide useful historical information to help investors evaluate the performance of the underlying

business and are measures commonly used by certain investors and security analysts for evaluating the performance of the Group. In addition,

the Group uses certain APMs which reflect the underlying performance on the basis that this provides a focus on the core business

performance of the Group. The APMs are not part of the IFRS financial statements and are accordingly not audited.

Pro Forma Revenue Growth

Pro Forma Revenue Growth FY22

The Group uses Pro Forma Revenue Growth as a supplemental measure of its performance. The Group believes that Pro Forma Revenue

Growth provides a guide to underlying revenue performance and is calculated by adjusting reported revenue for the impact of acquisitions,

disposals and foreign currency.

Pro Forma Revenue Growth adjusts reported revenue to reflect the disposal of Premier Molasses Company Limited for the period in FY21 up

to the date of disposal. As the current year was a 53 week period, Pro Forma Revenue adjusts the current year reported revenue to exclude the

additional revenue earned from the additional trading week (FY21: 52 week period). It also presents the revenue on a constant currency basis

utilising FY21 FX rates on FY22 reported revenue.

2022

Convenience Foods

UK and Ireland

Reported revenue – % increase from FY21 to FY22 31.3%

Impact of disposals 0.4%

Impact of currency 0.2%

Impact of additional trading week (2.5%)

Pro Forma Revenue Growth FY22 (%) 29.4%

The table below shows the Pro Forma Revenue Growth split by food to go categories and other convenience categories.

Food to go categories Other convenience categories

H1 FY22

H2 FY22

Full Year

H1 FY22

H2 FY22

Full Year

Reported revenue – % increase from FY21 to FY22 48.0% 31.1% 37.9% 12.9% 26.5% 19.8%

Impact of disposals – – – 2.0% – 1.0%

Impact of currency – – – 0.9% 0.2% 0.6%

Impact of additional trading week – (4.6%) (2.7%) – (4.2%) (2.2%)

Pro Forma Revenue Growth FY22 (%) 48.0% 26.5% 35.2% 15.8% 22.5% 19.2%

Pro Forma Revenue Growth FY21

While Pro Forma Revenue Growth is not directly comparable year on year, we have included the prior year disclosure for completeness.

This has been calculated by adjusting FY21 reported revenue to reflect the disposal of Premier Molasses Company Limited for FY20 and

for the period in FY21 up to the date of disposal. It also presents the revenue on a constant currency basis utilising FY20 FX rates on FY21

reported revenue.

2021

Convenience Foods

UK and Ireland

Reported revenue – % increase from FY20 to FY21 4.8%

Impact of disposals 1.3%

Impact of currency 0.1%

Pro Forma Revenue Growth FY21 (%) 6.2%

180 Greencore Group plc Annual Report and Financial Statements 2022

The table below shows the Pro Forma Revenue Growth split by food to go categories and other convenience categories.

Food to go categories Other convenience categories

H1 FY21

H2 FY21

Full Year

H1 FY21

H2 FY21

Full Year

Reported revenue – % increase from FY20 to FY21 (25.6%) 58.6% 9.0% (7.4%) 4.2% (1.9%)

Impact of disposals – – – 2.1% 4.7% 3.4%

Impact of currency – – – (0.3%) 0.7% 0.1%

Pro Forma Revenue Growth FY21 (%) (25.6%) 58.6% 9.0% (5.6%) 9.6% 1.6%

Adjusted EBITDA, Adjusted Operating Profit and Adjusted Operating Margin

Adjusted EBITDA, Adjusted Operating Profit and Adjusted Operating Margin are used by the Group to measure the underlying and ongoing

operating performance of the Group.

The Group calculates Adjusted Operating Profit as operating profit before amortisation of acquisition related intangibles and exceptional

items. Adjusted EBITDA is calculated as Adjusted Operating Profit plus depreciation and amortisation of intangible assets. Adjusted Operating

Margin is calculated as Adjusted Operating Profit divided by reported revenue.

The following table sets forth a reconciliation from the Group’s Profit for the financial year to Adjusted Operating Profit, Adjusted EBITDA and

Adjusted Operating Margin:

2022

£m

2021

£m

Profit for the financial year 32.3 25.7

Taxation

(A)

7.5 2.1

Exceptional items 16.5 (11.7)

Net finance costs

(B)

12.3 19.0

Amortisation of acquisition related intangibles 3.6 3.9

Adjusted Operating Profit 72.2 39.0

Depreciation and amortisation

(C)

54.7 53.3

Adjusted EBITDA 126.9 92.3

Adjusted Operating Margin (%) 4.2% 2.9%

(A) Includes tax credit on exceptional items of £3.0m (2021: £0.4m).

(B) Finance costs less finance income.

Adjusted Profit Before Tax (‘PBT’)

Adjusted PBT is used as a measure by the Group to measure overall performance before associated tax charge and other specific items.

The Group calculates Adjusted PBT as profit before taxation, excluding tax on share of profit of associate and before exceptional items,

pension finance items, amortisation of acquisition related intangibles, FX on inter-company and certain external balances and the movement

in the fair value of all derivative financial instruments and related debt adjustments.

The following table sets out the calculation of Adjusted PBT:

2022

£m

2021

£m

Profit before taxation 39.8 27.8

Exceptional items 16.5 (11.7)

Pension finance items 1.1 1.7

Amortisation of acquisition related intangibles 3.6 3.9

FX and fair value movements

(A)

(1.2) 0.9

Adjusted Profit Before Tax 59.8 22.6

(A) FX on inter-company and certain external balances and the movement in the fair value of all derivative financial instruments and related debt adjustments.

Alternative Performance Measures continued

181Strategic Report | Directors’ Report | Financial Statements

Adjusted Basic Earnings Per Share (‘EPS’)

The Group uses Adjusted Earnings and Adjusted EPS as key measures of the overall underlying performance of the Group and returns

generated for each share.

Adjusted Earnings is calculated as Profit attributable to equity holders (as shown on the Group Income Statement) adjusted to exclude

exceptional items (net of tax), the effect of foreign exchange (‘FX’) on inter-company and external balances where hedge accounting is not

applied, the movement in the fair value of all derivative financial instruments and related debt adjustments, the amortisation of acquisition

related intangible assets (net of tax) and the interest expense relating to legacy defined benefit pension liabilities (net of tax). Adjusted EPS is

calculated by dividing Adjusted Earnings by the weighted average number of Ordinary Shares in issue during the year, excluding Ordinary

Shares purchased by Greencore and held in trust in respect of the Annual Bonus Plan and the Performance Share Plan. Adjusted EPS

described as an APM here is Adjusted Basic EPS.

The following table sets forth a reconciliation of the Group’s profit attributable to equity holders of the Group to its Adjusted Earnings for the

financial years indicated.

2022

£m

2021

£m

Profit attributable to equity holders of Greencore 32.3 25.4

Exceptional items (net of tax) 13.5 (12.1)

FX effect on inter-company and external balances where hedge accounting is not applied 0.7 (0.1)

Movement in fair value of derivative financial instruments and related debt adjustments (1.9) 1.0

Amortisation of acquisition related intangible assets (net of tax) 2.7 3.2

Pension financing (net of tax) 0.8 1.4

Adjusted Earnings 48.1 18.8

2022

‘000

2021

‘000

Weighted average number of ordinary shares in issue during the year 523,382 511,764

2022

Pence

2021

Pence

Adjusted Basic Earnings Per Share 9.2 3.7

Capital Expenditure

Maintenance Capital Expenditure

The Group defines Maintenance Capital Expenditure as the expenditure required for the purpose of sustaining the operating capacity and

asset base of the Group, and of complying with applicable laws and regulations. It includes continuous improvement projects of less than £1m

that will generate additional returns for the Group

Strategic Capital Expenditure

The Group defines Strategic Capital Expenditure as the expenditure required for the purpose of facilitating growth and developing and

enhancing relationships with existing and new customers. It includes continuous improvement projects of greater than £1m that will generate

additional returns for the Group. Strategic Capital Expenditure is generally expansionary expenditure creating additional capacity beyond what

is necessary to maintain the Group’s current competitive position and enables the Group to service new customers and/or contracts or to

enter into new categories and/or new manufacturing competencies.

The following table sets forth the breakdown of the Group’s purchase of property, plant and equipment and purchase of intangible assets

between Strategic Capital Expenditure and Maintenance Capital Expenditure:

2022

£m

2021

£m

Convenience Foods UK and Ireland

Purchase of property, plant and equipment 48.6 37.1

Purchase of intangible assets 1.4 3.1

Net cash outflow from capital expenditure 50.0 40.2

Strategic Capital Expenditure 33.1 24.0

Maintenance Capital Expenditure 16.9 16.2

Net cash outflow from capital expenditure 50.0 40.2

182 Greencore Group plc Annual Report and Financial Statements 2022

Free Cash Flow and Free Cash Flow Conversion

The Group uses Free Cash Flow to measure the amount of underlying cash generation and the cash available for distribution and allocation.

The Group calculates the Free Cash Flow as the net cash inflow/outflow from operating and investing activities before Strategic Capital

Expenditure, acquisition and disposal of undertakings, disposal of investment property and adjusting for dividends paid to non-controlling

interests.

The Group calculates Free Cash Flow Conversion divided by Adjusted EBITDA.

The following table sets forth a reconciliation from the Group’s net cash inflow from operating activities and net cash outflow from investing

activities to Free Cash Flow:

2022

£m

2021

£m

Net cash inflow from operating activities 92.9 102.7

Net cash outflow from investing activities (50.0) (17.6)

Net cash inflow from operating and investing activities 42.9 85.1

Strategic Capital Expenditure 33.1 24.0

Repayment of lease liabilities (17.3) (14.3)

Disposal of undertakings – (16.3)

Disposal of Investment Property – (6.3)

Free Cash Flow 58.7 72.2

Adjusted EBITDA 126.9 92.3

Free Cash Flow Conversion (%) 46.3 78.2

Net Debt and Net Debt excluding lease liabilities

Net Debt is used by the Group to measure overall cash generation of the Group and to identify cash available to reduce borrowings. Net Debt

comprises current and non-current borrowings less net cash and cash equivalents and bank overdrafts.

Net debt excluding lease liabilities is a measure used by the Group to measure Net Debt excluding the impact of IFRS 16 Leases. Net debt

excluding lease liabilities is used for the purpose of calculating leverage under the Group’s financing agreements.

The reconciliation of opening to closing Net Debt for the year ended 30 September 2022 is as follows:

24 September

2021

£m

Cash flow

£m

Translation

and non-cash

adjustments

£m

30 September

2022

£m

Cash and cash equivalents and bank overdrafts 73.6 (26.5) (0.4) 46.7

Bank borrowings (150.1) (9.6) 0.9 (158.8)

Private Placement Notes (106.6) 47. 3 (8.6) (67.9)

Net debt excluding lease liabilities (183.1) 11.2 (8.1) (180.0)

Lease liabilities (59.6) 18.5 (6.9) (48.0)

Net Debt (242.7) 29.7 (15.0) (228.0)

25 September

2020

£m

Cash flow

£m

Translation

and non-cash

adjustments

£m

24 September

2021

£m

Cash and cash equivalents and bank overdrafts 47.0 27.0 (0.4) 73.6

Bank borrowings (283.5) 130.9 2.5 (150.1)

Private Placement Notes (114.0) – 7.4 (106.6)

Net debt excluding lease liabilities (350.5) 157.9 9.5 (183.1)

Lease liabilities (60.7) 15.6 (14.5) (59.6)

Net Debt (411.2) 173.5 (5.0) (242.7)

Alternative Performance Measures continued

183Strategic Report | Directors’ Report | Financial Statements

Return On Invested Capital (‘ROIC’)

The Group uses ROIC as a key measure to determine returns for the Group as a whole and as a key measure to determine potential new

investments.

The Group uses invested capital as a basis for this calculation as it reflects the tangible and intangible assets the Group has added through its

capital investment programme, the intangible assets the Group has added through acquisition, as well as the working capital requirements of

the business. Invested capital is calculated as net assets (total assets less total liabilities) excluding Net Debt, the carrying value of derivatives

not designated as fair value hedges, and retirement benefit obligations (net of deferred tax assets). Average invested capital is calculated by

adding the invested capital from the opening and closing Statement of Financial Position and dividing by two.

The Group calculates ROIC as Net Adjusted Operating Profit After Tax (‘NOPAT’) divided by average invested capital. NOPAT is calculated as

Adjusted Operating Profit plus share of profit of associates before tax, less tax at the effective rate in the Income Statement.

The following table sets forth the calculation of Net Operating Profit After Tax (‘NOPAT’) and invested capital used in the calculation of ROIC.

2022

£m

2021

£m

Adjusted Operating Profit 72.2 39.0

Taxation at the effective tax rate

(A)

(13.7) (5.9)

Group NOPAT 58.5 33.1

2022

£m

2021

£m

Invested capital

Total assets 1,338.7 1,291.5

Total liabilities (873.1) (868.3)

Net Debt exclusive of liability held for sale 228.0 242.7

Derivatives not designated as fair value hedges (14.8) 5.6

Retirement benefit obligation (net of deferred tax asset) 10.4 29.3

Invested capital for the Group 689.2 700.8

Average invested capital for ROIC calculation for Group

(B)

695.0 728.8

ROIC (%) for the Group 8.4 4.5

(A) The effective tax rates for the Group for the financial year ended 30 September 2022 and 24 September 2021 were 19% and 15%, respectively.

(B) The invested capital for the Group was £756.8m in 2020.

184 Greencore Group plc Annual Report and Financial Statements 2022

Other information

Greencore Group plc (the ‘Group’, the ‘Company’ or ‘Greencore’) is an Irish incorporated company registered under number 170116.

ItsOrdinary Shares are quoted on the London Stock Exchange (Symbol: GNC). Greencore has a Level 1 American Depositary Receipts

programme (Symbol: GNCGY).

Financial Calendar

Annual General Meeting 26 January 2023

FY23 H1 Results 30 May 2023

FY23 financial year end 29 September 2023

FY23 Full Year Results 28 November 2022

Advisors and

Registered Office

Group Company Secretary

Damien Moynagh

Registered Office

No. 2 Northwood Avenue

Northwood Business Park

Santry

Dublin 9

D09 X5N9

Ireland

Auditor

Deloitte Ireland LLP

Earlsfort Terrace

Dublin 2

D02 AY28

Ireland

Registrar and

Transfer Office

Computershare Investor

Services (Ireland) Limited

3100 Lake Drive

Citywest Business Campus

Dublin 24

D24 AK82

Ireland

Solicitors

Arthur Cox

Ten Earlsfort Terrace

Dublin 2

D02 T380

Ireland

Eversheds Sutherland

Bridgewater Place

Water Lane

Leeds

LS11 5DR

United Kingdom

Bryan Cave LLP

One Metropolitan Square

211 North Broadway

Suite 3600

St. Louis MO 63102–2750

United States

Stockbrokers

Goodbody Stockbrokers

Ballsbridge Business Park

Ballsbridge

Dublin 4

D04 YW83

Ireland

HSBC Bank plc

8 Canada Square

London

E14 5HQ

United Kingdom

Shore Capital

Cassini House

57 St James’s Street

London

SW1A 1LD

United Kingdom

American Depositary

Receipts

BNY Mellon

101 Barclay Street

22nd Floor – West

New York NY 10286

United States

Website

www.greencore.com

Follow Greencore on Twitter

@GreencoreGroup

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Greencore Group plc

No. 2 Northwood Avenue, Northwood Business Park

Santry, Dublin 9, DO9 X5N9 T: +353 (0) 1 605 1000